Did you checked on https://www.google.com/fonts/ if both fonts exist with "500 medium" style? Because as we see, only Roboto is available with this weight. But Lato is not and for this font you must choose different style.
No, this is not correct because you don't have this font included in Font Family section as you can see. This font must be included there if you want to use it.
From what we see, headings on your website got the same font as on our demo - we meant "Lato". The only difference is between font weight. On our demo we use 300 style, so you should mark all 300 on your side in muffin options panel and this should help you. But if won't of unknown reasons, then please send us access to your dashboard on pm with explanation and we'll see what you did wrong.
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