Translation:The fish in the water are like the sharks: big and terrible.
Your English answer is grammatically correct, but is not a translation of Duo's Hungarian sentence (which has plural halak, amilyenek, nagyok, szörnyűek).
Duo's English sentence ("fish are") is fine. It's like the second example in Joeintheory's answer ("Many fish are swimming here").
It would be the same. Hungarian uses the definite article for generalisations, and "The fish in the water are like sharks" is now an accepted answer
"Like sharks in general" would probably be the primary understanding, unless particular sharks were specified, e.g, "a cápák, amelyek a vízben is úsznak".
Most of this sentence is straightforward. The bit I struggle with is olyanok, amilyenek. No problem with the need for a plural. My difficulty is the need for both words. I often see olyan mint and I have seen it translated as looks like. Could it be the case that olyanok amilyenek means (or can mean) looks like but in the plural form? The fish in the water look like sharks: big and terrible.