I would say that 'A lot of sugar?' is not a proper translation to English as it isn't even a sentence. Wouldn't an English person say 'Is it/that a lot of sugar?' or 'Is there a lot of sugar?'
Looking at it from your point of view, "hodně cukru" is also not a proper Czech sentence - with predicate and subject. It only determines the amount of sugar.
"hodně cukru" translates as "a lot of sugar"
How much sugar do you put in a cake? A lot of sugar. - Kolik cukru dáváš do dortu? Hodně cukru.
IT IS A QUESTION. Quite a frequent one. The most usual meaning is: ´How much sugar do you want (me to put in your hot beverage)?´The answer then is in spoons or cubes.
Thanks for the downvote.
You said it is a frequent question, so you'd better use it in your example. ;-)
"A: How much sugar do you want? Kolik cukru chceš? - B: Three spoons/cubes. Tři lžičky/kostky."
I'll add one situation where I'd use it as a question: "A: How much sugar do you want? Kolik cukru chceš? - B: A lot of sugar. Hodně cukru. - A: A lot of sugar? Hodně cukru?"
In the question, Much sugar is certainly correct; in the reply, a lot of sugar would be more natural.
For what it's worth, as a native (US) English speaker, I don't think there's anything at all wrong with the English translation "a lot of sugar," whether it's used as a question or as a statement. The only way I'd expect to hear "much sugar" used in English would be in a phrase like "too much sugar" or "how much sugar." (YMMV.)