I don't really understand this stuff super well, but... I suspect what it means is that Google can track you while google maps is open, BUT since it doesn't have access to the rest of your phone, they'll have no idea who you are anyway?

For grapheneos sandboxed means the Google apps are just regular apps, they don't have privilege, they're not escalated, they are exactly the same as other apps. Very specifically, it means Google services are only accessible in the user/profile that they are installed in, and not phone wide

If you use a Google service, or an app that interacts with the Google apps, then Google knows about it. In graphene OS you can choose what apps have access to Google services, by running them in a different profile.

but what does it mean when you say "Sandboxed?

By default, on a normal Android device, Google Play services are installed as a system application. It means that you can't remove it, and it can grant itself the permissions it needs. In contrary, regular user apps run in the Android application sandbox. They are installed by the user, have distinct permission controls that are enforced by the operating system and can be uninstalled at any time. Sandboxed Google Play is a compatibility layer created by the GrapheneOS team, which allows you to run Google Play services (which would normally require system privileges) to run as a normal user app in the regular application sandbox.

Yes, because the Google Wallet app requires a higher level of SafetyNet attestation, which can only be achieved when running an OS that's specifically whitelisted by Google.