As far as I understand "aquilo" can replace a noun and "aquele" an adjective. Am I right, or not?
That's right. To be exact, "aquele" is a demonstrative adjective.
can we have an example please?
The gender of the thing you're referring to doesnt matter? For example, you might be asking about a drink.
"Aquilo" is invariant.
The hints give "that thing" as a translation, but it's marked wrong when I try it?
I answered "What is that one?" and was marked wrong. Why is it incorrect? Thanks.
Why "Who is that?" is not the right answer?
I don't speak Portuguese but who = quem and what = que