I really don’t like that explanation. My understanding is that it was meant to be an outrageous situation satirizing the way the quantum physics field was at the time. The idea is that only observation creates action (ie only by observing the cat does the cat actually live or die, so clearly someone has to be observing you to make you go and check on the cat, and who’s observing them to make sure they observe you so you can check and the cat can live or die – it goes on and on my friend, it is the theory that never ends, some people started thinking it…).
However, in modern-day parlance, it simply refers to a state of indeterminacy, that you don’t know until you see. For instance, restaurants I haven’t tried could be termed “Schrödinger’s restaurant”, and only upon trying them could I find out if it was going to be a good experience or bad. I’ve heard of the idea that every new man a woman meets is in a state of rapist indeterminacy (because she does not know him, she does not know if he’s a rapist or not), thus all new men are at one point “Schrödinger’s rapist”.