Although that is what I also put, and was marked wrong, I think I know why. Wouldn't what you (and I) wrote be "Cos'è la significa …" ("What is the meaning...") whereas their sentence was "Cosa significa..."? In other words, in what you and I wrote "significa" is a noun, and in DL's sentence it is a verb (literally 'it means'). Roughly speaking "What it means this phrase?" or "What does this phrase mean?"
Well the meaning is obviously the same, but the structure of the sentences is different (e.g. you use the noun "meaning" where the italian uses the verb for "mean" etc.). It's only wrong if DL wants you to use the same structure as well as the same meaning. But that would be pretty harsh. Nevertheless its best to translate as literally as possible with DL to be on the safe side. I suppose that, taken across the entire course, it might also have the learning benefit that the structure of the reverse translation is more likely to result in a correct structure in the Italian.