Do you mean that using this in real life would be an insulting form? If so, what is a better way?
Yes, "who are you?" does sound a little rude. Years ago, I was at an office, and a woman came to the counter and said to me, "Who are you?" At the time, it seemed very rude to me. I think, it'd be politer to ask, "What's your name?" but anyway, in this exercise, it's teaching how to say "who?" I suppose what's rude in English, might not be considered rude in another language and culture.
You are quite right. What may sound rude in one language is not necessarily considered to be rude at all in another. But I'm quite sure it could be asked in a condescending way in Italian as well.
I don't understand why does anybody mix "Who are you?" with "What is your name?" when these are two different questions, with different meanings, and are not interchangeable. It's like saying that "What is your name?" is similar to asking "What are you?". So accusing Duo in being rude here, just because someone doesn't understand the difference between these questions, is nonsense.
I would say no. "Who is it/Who's there" take the third person singular, not the second person singular. Also, it's a bit of a different question.
I can't hear the "ch" sound in this recording, it just sounds like "i sei." Is this just me?
That would just be "who you". "sei" is uniquely the "tu" form of the verb, so the pronoun can be omitted. But you do need the verb.