"Před dvěma minutami naše děti ještě nespaly."

Translation: Two minutes ago, our children still were not asleep.

[dsarkarati]

"Our children were still not sleeping two minutes ago." has the same meaning as the given translation and is grammatically correct.

[Tibro3]

Seconded.

[vor23]

I agree completely. I just submitted "Our children were still not asleep two minutes ago" and it was rejected. What you wrote and what I wrote are more natural than Duolingo's default translation.