So "we want to eat later" shouldnt have been marked incorrect?
Also, how would you say "we want to eat more later" if not the way presented here?
Example for context...
(At dinner) Mom: Do you or your friends want more cake now? Me: [Not right now, but] we want more later [so don't throw the rest of it out].
"We want to eat later" is correct (and is the default translation from Duolingo, according to the top of this page).
As for how you might say "We want to eat more (cake) later", you'd have to double-up the "más".
- Queremos comer más (pastel/torta/etc) más tarde.
I suspect that kind of "double más" would sound jarring to native speakers, and they'd prefer to rephrase the sentence using "luego" as a synonym for "más tarde", or something along those lines.