Generally when talking about something where there could be confusion (a fence), ऊंची would be used to mean tall and लंबी would be used to mean long. It's sort of wierd that they have a word that means both long and tall, but when you think about it, in most situations if you say "यह लंबी है" one can likely infer what you mean by what you are referring to (person, highway, tree, etc.). I guess whoever made this question figured it's fairly clear when referring to a wall you mean that it is tall.
The translation should be "this wall is long". Translation from लंबी to feminine tall would be acceptable if it refers to feminine objects or beings which can be large in only one dimension, and can stand upright in that direction. A wall can be oblong in two dimensions but is more likely to be longer along the ground and hence fits with लंबी translating to long. यह दीवार ऊंची है। is a lot more appropriate to translate to "this wall is high/tall"
Like in the case of the word Freedom , both स्वतंत्रता, and स्वतन्त्रता are correct, in fact they're the same(in case if we split the letters,) but the way they're written are different.
It's not that it's a wrong way of writing it , but its just that it's not in frequent use nowadays.