Earlier quoted context omitted.
Other way around: Everything at Google runs inside a container, including the VMs gVisor lets you run multiple untrusted workloads on the same VM, in this case a GKE node.
What would running a VM inside a container provide in terms of security and isolation that just running a VM would not? This ACM article from a few years ago written by folks that worked on Borg/Omega/Kubernetes states: >"The isolation is not perfect, though: containers cannot prevent interference in resources that the operating-system kernel doesn't manage, such as level 3 processor caches and memory bandwidth, and…
The fact that gVisor is being used in multiple services at Google is probably the confusing part. In case of GKE Sandbox, the users here are external and using Cloud (specifically GKE). The target use case is to add defense in depth to their pods running on potentially shared GKE Nodes (VMs) for Multi-Tenancy. Our talk at Next'19 [1] includes a story by one of our customers, which may help understanding the use cases.