"Bist du nicht der Gute?"
All nouns in German are capitalized, in this sentence "Gute" is capitalized and becomes a noun making it specific to one person - "good one". Writing "Are you the good" in English only counts as correct because it literally directly translates into that. Had the "G" in Gute not been capitalized, it would make the same amount of sense in German as "Are you the good" does in English.
Personally, even the sentence "Are you the good one?" makes very little sense in English. Sure, it COULD make sense in a very specific context, but for the most part, it does not.
But that's exactly like many other phrases, it makes sense only with context.
Yes, I am the good one, here is the bad one, and please meet mr ugly over there
No, it's to be used in a very specific context ... like you were looking for some doctor named Müller, say, and you found him, but he was the wrong doctor. There would be some confusion and you could then ask "Bist du/Sind Sie nicht der Gute?"
Translation makes no sense. Is it some german thing that doesn't translate well to English?
Should the translation not be "Are you not the best?" That makes more sense to me in both languages.
"the best" would translate to "der Beste" as a noun, as an adjective would have to be the superlative "am besten"or the comparative "better" > "besser".
This verb (sein; to be) is a linking verb which uses nominative case, not accusative. There are a few of these but this one is common.
So, assuming this makes sense in German, what would be a good free translation of this phrase?
"Aren't you (supposed to be) the good one?" maybe?
How is You are the good? can be an accepted answer when there is a nicht in the german phrase?
The I encounter this kind of phrases I google them and most of the times you find them in a concrete context and you get the idea.
Are all the adjectives used as nouns -- like The Good, the Bad and the Ugly -- always masculine (der)?
Depending on context, yes, they can all be correct. "der" when referring to a man, "die" to a woman and "das" when referring to a child, for example. It is only implied here that the "good one" is a he.