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What I had:

A: Not quite correct because the anteater is not similar in all relevant aspects, in fact just the opposite is true. Its difference is what leads to the conclusion.

B: This seems true as a standalone statement but not related to the argument at hand, there is no majority of predictions that was correct. IF there was, what was the wrong one?

C: This seems closer but not quite there. The anteater is a counterexample with different behaviour, therefore it does not confirm a purpose as it is not the same object or action.

D: This seems correct, a prediction is that dreaming gets rid of these connections, which there is not enough room for. If there were enough room, there would be no need from an evolutionary perspective for dreaming.

E: There is not several hypotheses.
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(A) Facts about one species of animal can provide confirmation for hypothesis about all species that are similar in all relevant respects to the particular species in question. Humans and anteaters are not similar in all respects, only in the fact that they are mammals. This principle is not used in the argument. Eliminate.

(B) A hypothesis from which several predictions can be drawn as logical conclusions is confirmed only when the majority of these predictions turn out to be true. Only one prediction from the parasitic-connection hypothesis is mentioned in the argument, not several. Hence, question of majority being true does not arise. Eliminate.

(C) A hypothesis about the purpose of an action or object is confirmed when it is shown that the hypothesized purpose is achieved with the help of the action or object and could not be achieved without that action or object. It is not shown explicitly that the brain is erasing “parasitic connections” (the purpose) while dreaming (the action), nor that parasitic connections cannot be erased without dreaming. Eliminate.

(D) A hypothesis is partially confirmed whenever a prediction derived from that hypothesis provides an explanation for an otherwise unexplained set of facts. Correct answer. The parasitic dream hypothesis is partially confirmed because the prediction about large brains for non-dreamers (anteaters) explains why they don't have dreams.

(E) When several competing hypotheses exist, one of them is confirmed only when it makes a correct prediction that its rivals fail to make. There are no multiple competing hypotheses in this argument. Eliminate.

Hope this helps.
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I have a doubt about OA (which is D): How do we know the set of facts is otherwise unexplained?
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