"Are you all students?"
Recall that omitting 的 holds when either a close relationship between multiple people or school/work relationship (i.e. institution) is involved.
The sentence then becomes "Are they their students?" since 你们学生 can also suggest ownership of objects. So to avoid ambiguity, either a verb or the connector (的) should be included.
As a side note, the more correct translation to the original sentence is
since the question is in yes-or-no format, and since 都 is included to avoid any ambiguity of specification.
If you are asking whether you can omit 是, the answer is no.
You are probably thinking about the case of adjectives where there is no verb. That doesn't work when you equate a noun to another.
I used the male form and the correct answer is female but there is no indication in the question of female or male...
Technically the male form is used when gender is unknown or not important (like when referencing a group). You should be correct but I guess duo hasn't fixed the problem yet.