"To be at rest" in classical mechanics means "to have definite position and zero momentum", the two properties being (again, in CM) equivalent: if something has definite position, then it must have zero velocity thus zero momentum, and if it has zero momentum, then it must have zero velocity thus definite position. Depending on which of the two properties above you decide is most suitable to define an object at rest, you have, at least classically (i.e. without talking about probabilities), $\Delta x=0$ and/or $\Delta p=0$$p=0\ \Longrightarrow\ \Delta p=0$, the "and" being necessary fromdue to the classical definition of "rest", the "or" to give (if necessary) the possibility to chose the direction of the implication ($\Delta x=0 \ \Longrightarrow\ \Delta p=0$ or $p=0\ \Longrightarrow\ \Delta x=0, \Delta p=0$). At an undergraduate level, students are taught to think in terms of classical mechanics even when dealing with quantum mechanics, so we can assume that this is the definition they are implying. I think that you are missing the fact that they don't want to go into the details of why the statement is true. They just want the student to show that he has an elementary understanding of the Uncertainty Principle (or rather, of its pop-science formulation) and of what it means to "be at rest". From this perspective, their answer is right, while yours is imprecise: if $p=0$ (hence $\Delta p=0$), then $\Delta x$ is not infinity, it is zero as well. Keep in mind that they are identifying $\Delta x$ and $\Delta p$ with classical observables, so that $\Delta p=0$$p=0$ implies $\Delta x=0$ and vice versa. On the other hand, either $\Delta p$ or $\Delta x=0$ being zero - without talking about the other one - is sufficient to invalidate the Uncertainty Principle: regardless of the other you have $0\geq \hbar/2$. An undergraduate isn't usually required to speak in terms of divergences, so I guess that the argument "the other one should diverge" isn't taken into consideration from the very beginning. In the end, as they say, they don't want an argument for the statement to be true, they're just looking for the "insight that being at rest means [more correctly, "implies"] Δx and/or Δp is $0$". Then you plug it in the uncertainty relation, and you get the point.