Yes, but I think Duo focuses more on general definitions than specific ones. Just to be safe and to keep all of your hearts, go with the general definition in cases like this. You could report it and see if Duo would be willing to change that.
Isn't "The watch's colorful" the same as "The watch is colorfuk". I'm not a native english speaker but I think that's a way to write it too
In spoken language, you are correct. If you are writing a dialog, people would absolutely write that way, and should. In normal writing, unless there is a very good reason why you need to use contractions (like a dialog), it is not used. Not used in business email, rarely used in texts (mostly because you'd have to go searching for the apostrophe, not because it would be wrong), and not even okay for my kids' thank you notes to grandparents. It is absolutely correct for kids under ten in their "formal" writing, if that gives you a sense of it.
Notice there is kind of a feel to it. "wouldn't, couldn't, shouldn't, you'd he'd", any contraction with "not" or "would" FEELS okay where contractions with "is" FEEL really juvenile.
But we should be talking about Portuguese!