"The sugar is not good."
Translation:Der Zucker ist nicht gut.
Correct, however if there is no specific verb to negate (just the sentence as a whole) it goes on the end. This was not such a sentence though, which is why it was regarded incorrect.
How do you know when something is masculine, feminine or neuter in German?
Because zucker is masculine (use der). Das is used with neuter nouns. Apparently you just have to memorize the masculinity of all nouns.
What if I wanted to use "kein" instead? How do u bend the word "kein" in this sentence, and if it's not right to use "kein" here, than why not?
Is there any comprehensive difference in meaning between "Der Zucker ist nicht gut" and 'Der Zucker ist schecht?"
I do think there is. "Isn't good" doesn't mean that is bad, it could be regular or worse than bad or even, we can say "isn't good, id fantastic!", but is true that usually the meaning is very similar.
Assuming you mean "Der Zucker ist schlecht": as far as I know there is no difference.