"The boy wants water."
Translation:Tá uisce ón mbuachaill.
I strongly second that! There needs to be a lesson that actually teaches the patterns. I do not have a clue about question structures, or the difference between Irish forms of "want" and "need" for that matter. Every time I think I've figured it out and type something in, it gets marked as wrong. I've started to just note down single sentence on a piece of paper and then just type it in when it comes up again. This is more than frustrating!
I think you're right. See: https://en.wiktionary.org/wiki/%C3%B3n#Contraction
It is always ón.
Táim is not considered a contraction, it is considered a synthetic form. There are many other synthetic forms used in other tenses and moods that are clearly not contractions, like bhíomar in the past tense, or bheifeá in the conditional - táim happens to look like a contraction, and it coincides with a contraction in English, but technically, it isn't.
The translation is not incorrect.
Both Tá an bhuachaill ag iarraidh uisce and Tá uisce ag teastáil ón mbuachaill are used in some dialects of Irish, but tá uisce ón mbuachaill and teastaíonn uisce ón mbuachaill are also used to say "The boy wants water", and they are the constructions that Duolingo teaches.