Ha! I remember being surprised to see all those pastel colored houses in the Czech Republic, when I was there on holiday for the first time as a teenager. I also recall having seen světle zelené, světle červené, světle modré and světle fialové houses ;-)
Why can't it be "home"? To my knowledge "dům" means both, and both words in this sentence would be acceptable. Can someone correct me?
Yes, "dům" can mean "home," but most of the translations at the first link below are more like "house." "Domov," it would appear, may more often be used for "home," at least according to the second link below.
From what I've seen in the course, "dům" has generally been used in the meaning of "house" or "(apartment) building."
If you get this exercise again, you could report it as "My answer should be accepted," and see if it's added to the list of good translations.
Disclaimer: I am learning, too, so someone else may provide a more authoritative explanation.
No, you can't say that.
Světle is an adverb. Světlý is an adjective. In the sentence above, světle modifies žlutý.
"Náš dům je světle žlutý" So are you saying světle is an adverb in this sentence?