Should this not be : Is this wrong? Or Is it wrong? In same series of exercises you state 'This is the wrong František' there seems to be some inconsistency with trsnslation/meaning of the word spatně: bad or wrong...
špatný can mean both 'bad' or 'wrong.' If you want to emphasize that sth is incorrect, use nesprávný.
Should "is this bad" also be accepted?
Yes, it can be accepted, too.