Translation:They have a discussion with me but they do not believe me.
thảo luận is also a verb meaning 'to discuss'. So 'they discuss with me...' should also be correct.
No because the English word "discuss" must be used with an object. It would have to be something like "They discuss it with me" or "They discuss something with me", etc.
In English the second "they" can be left out, so this should also be accepted:
They have a discussion with me but do not believe me.