There are two ways that I think this question could be approached: geometric or algebraic.
For the geometric method, sketch the line 2x + y - 10 = 0 on the Cartesian axes. Call this line 'Line A'. You want the point on this line closest to the origin. Now, imagine drawing a line from the origin that is perpendicular to Line A. This line will hit a point on Line A. Let's call that point 'Point A'. It turns out that Point A is in fact the point you want! Why? Let's think in terms of parallel and perpendicular components, and Pythagoras' Theorem (or vector projections if you do Specialist Maths). Point A has some 'perpendicular distance' from the origin. This perpendicular distance is of course the distance of Point A from the origin. Every other point on Line A has both 'perpendicular distance' and 'parallel distance'. In other words, if you choose any other point on Line A, you could draw a right angled triangle using the origin, Point A, and your chosen point. Then, by Pythagoras' Theorem, we have (distance from origin to chosen point)^2 = (distance from origin to Point A)^2 + (distance from Point A to chosen point)^2. It logically follows that the distance from the origin to the chosen point is larger than the distance from the origin to point A. Hence, point A is the closest point on the line to the origin.
Therefore, all you need to do is to work out what the equation of the line from the origin perpendicular to Line A is. (Hint: use the gradient of Line A and the fact that the line must pass through the origin). You can then find the point where the two lines intersect; this is Point A. Once you know the coordinates of Point A, you can easily work out the distance.
For the algebraic approach, consider that the distance of any point (x, y) from the origin is given by sqrt(x^2 + y^2). Therefore, we may restate the question as: Find the minimum value of sqrt(x^2 + y^2) given the condition 2x + y - 10 = 0. If we rearrange the original equation for the line in terms of y and square it, we get an equation for y^2 that is a quadratic in x. Adding x^2 to this equation will give us an equation for y^2 + x^2 that is (a different) quadratic in x. Because the minimum value of sqrt(x^2 + y^2) will also be the minimum value of x^2 + y^2 (subject to our initial condition), then all we have to do is find the minimum value of this quadratic. By using calculus or completing the square, you should be able to find the minimum x-value. Then all you have to do is substitute this back into the original equation to get the y-value, and then you can work out the distance.
As for whether this question is on the study design, I believe it has been placed on at least one VCAA exam (and I remember the guy from my school's VCE revision lectures going through this style of question). Whether it is applicable to a student completing Maths Methods in 2015, I do not know.