I was doing this problem and I got stuck so much time, and then I conclude this.
$$|x - y|\le|x| + |y| .$$
Then, square both sides
$$|(x - y)(x - y)|\le(|x| + |y|)².$$
Since $(x - y)²$ is always positive, as well as $x²$ and $y²$, we get
$$(x - y)²\le x² + 2|xy| + y².$$
Develop the product
$$x² -2xy + y² \le x² + 2|xy| + y²$$
$$-2xy\le2|xy|$$
$$-xy\le|xy|$$
And this is true.
I'd like to know if I did this correctly and If there's a smaller/easier proof because the problem is doing by a very short proof.
Your approach is correct; do make sure that every step you have taken can also be taken in reverse. So far you have a proof that $$\textbf{If}\quad|x-y|\leq|x|+|y|\quad\textbf{then}\quad-xy\leq|xy|,$$ but of course you want to prove the opposite implication.
A shorter proof would be to use the triangle inequality; $$|x-y|=|x+(-y)|\leq |x|+|-y|=|x|+|y|.$$