I think the literal translation should be accepted as well.
I've heard things like "promise the moon" but not with the wording of "no need to promise me the moon". This isn't a phrase I'm familiar with, and if literal translations aren't accepted then I have to half translate the Ukrainian idiom and try to work out what the English equivalent is and how it should be worded to fit with the Ukrainian version. It makes it too hard to get right if it's not a very common phrase to all English speakers.
Plus when you learn idioms you want to know the literal meaning as well as figurative so you understand the words you're saying and not just the phrase. It's interesting to know how cultures word things differently, but also because you might hear гори in some other sentence and then think it means the moon.
I would say the "no need" gives a slightly wrong feeling here.
"No need" doesn't mean "don't" in English - not really. Means, you can do it, but there is no need. In Ukrainian very often "не треба" really means "Don't!" rather than "you don't have to".
E.g. "Не треба мені це пояснювати!" (Don't explain this to me!) (OK, "No need to explain this to me!" said with a certain intonation gives the same feeling)
In my perception, the sentence "Не треба обіцяти мені золоті гори" gives a vibe of "Don't promise me the moon! (You'll never be able to do it anyway)"
And yeah, to translate idioms literally or not has always been a debate... I'm still not sure what I think myself... On one hand, yes, that IS the literal meaning of the sentence, therefore the translation should be accepted, since hypothetically the sentence can be used literally and not as an idiom. On the other hand, this might make the learners lazy in always translating it literally rather than learning the meaning which is the purpose of the exercise... I really don't know :/
Yeah that's the problem with translating idioms. You can't do a "hover hint" over each word, because it doesn't translate literally. However, when learning it, you would like to know the literal meanings of words to understand why that idiom means that. So it's a compromise of a sort...