So the verb "to be ill" is "enfermar"
Actually "to be ill" is not a verb. Only "to be" is the verb; "ill" is an adjective, or a qualifier. You ask "Are you ill?" just like you could ask "Are you tired?", "Are you blonde?" or "Are you Belgian?".
With that in mind, enfermo (or enferma in feminine) is just the Spanish adjective for "ill":
Del lat. infirmus.
- adj. Que padece enfermedad. U. t. c. s.
So with estás being second person singular of estar, "to be"; and enfermo being "ill", the correct translation is indeed:
(Your quoted translation is missing the question marks, but you must always include them).
You're right about "enfermo" (also) being one of the conjugations of the verb "enfermar", but that verb means "to become ill". It is not used to say that you are ill.