"They paint a house" should be accepted
No, it shouldn't be accepted. The partitive case denotes an incomplete process which is not conveyed by the simple present in English.
So would that be "he maalaavat talo" then?
"They paint the house" was also marked wrong. I have reported it.
Does this mean they are painting the house itself a certain color, or that they are working on a painting of a house? Or both?
Both are possible.
Why not "they paint the house"?
I think the partitive case (taloA) denotes an ongoing or incomplete action, if I understand correctly