What exactly does "RCE inside sandbox" describe that goes beyond "the webpage can supply arbitrary JavaScript and the JavaScript engine executes it", but is still isolated from the system?
It means it can execute native code inside the sandbox, as opposed to Javascript. While still sandboxed, this lets it access some parts of the attack surface that JS would not have been able to, some of which may have other exploits that allow escaping the rest of the way.
It means it can execute arbitrary machine code in the sandbox.
Memory isolation having one tab or account open on your bank and another on this page does not mean it could leak across the sandbox and steal bank account details but anything inside of your general page content can be lost
Chrome runs webpages in individual sandbox processes with very low privileges, as a defense-in-depth strategy. It generally requires at least two exploits to actually affect a user--first, get RCE in a sandboxed process, then find a separate vulnerability that lets you escape the sandbox process entirely. For this bug to have actually been used in the wild, there was almost certainly a second bug as well.