"Nosotras bailamos toda la noche."
Translation:We danced all night.
Of course it can Sarah!
nosotros bailamos present tense "we dance" or "we are dancing".
Even if the authors aren't very good at Spanish they can easily look up the conjugation table just like we can.
Edit: "We were dancing all night" was also refused.
What on Earth do the Duolingo staff possibly hope to achieve by persistently marking right answers "wrong"?