Q. Is this correct or should the capital gains be removed from the Ohio Schedule IT as a business income?
A. No.
Q. Same situation with Line 1, Interest and Ordinary Dividends?
A. No.
TurboTax (TT) asks you to tell it whether those items are business income. You need to go back to that screen and change your answer to 0, in each category.
Your schedule C income is business income for the Ohio Schedule IT Bus. But your schedule C income (most likely) does not qualify for the Federal QBI deduction. This is because of rules about doing business with your former employer.
