The official site probably explains it better than I can:
Basically it's a "sandbox" for testing programs or whatever you want. I personally use it sometimes to install and try out larger programs that might be difficult or complicated to uninstall. Each time you Windows Sandbox, it's a fresh install with around 40GB of space, and every time you close it, everything's gone. It's like a virtual machine so don't expect the performance of your actual computer here.
Something else, too. I could be wrong, but apart from being pretty anonymous on your computer, it looks like you can use Windows Sandbox to be partly, well...maybe slightly anonymous online as well. With my basic testing, the IP address changed slightly with each launch and Google Maps showed a slightly different location.
I just created this account to say this, that is all.