As <legal = cool> is merely slang (albeit possibly widely used), I find it wrong that the translation hint in this sentence doesn't include the primary meaning ie. legal/lawful (although the situations in which you characterize people as cool/nice instead of legal (such as visitors, travelers etc.) are probably more common).
That's mad that it's not in the OED....it's gone way way past slang. It is in most other dictionaries: http://www.macmillandictionary.com/dictionary/british/cool_1#cool_1__5
Are they cool, is a correct answer. In the same group of exercises legal = cool (um cara legal = a cool guy).
Without any context, are they legal and are they cool must both be accepted.