The official translation is completely correct. "Saath men rehna" is phrase that just means living together. It can apply to children living with their parents or two brother living together or any such thing.
"saath men rehna" has no connotation of a live in relationship whatsoever.
The creators of each course have to add every word alternative to each sentence to make it accept the options. Quite a lot to put in! Would be good though if course- or Duolingo-wide alternatives could be defined, such as and/&. But, if e.g. grandfather and grandad and grandpa were course-wide defined as the same, it wouldn't be possible to teach those words individually. So I guess that's a reason for not setting such things.