The term is generally used to describe an appliance that has a built-in firewall, as opposed to loading a software program on your computer that does the firewall function.

It doesn't really matter how the firewall is implemented in the appliance (eg, router) as long as the function is built-in to the appliance. It's all software at the end of the day, but that doesn't really matter. (Does it matter if your washer/dryer has a computer program driving the display, controls and operation of the appliance?)

-David