"Much like the notice vendors can put on Windows software that says, Windows Certified. Which only means the app was submitted to Microsoft".
In fact it is even less than that. It is just an additional code signing step in order to add confidence in the Dev ID signature at the moment the App is released. It does some checks for potential malicious behaviors but that's it. It is used in interaction with Gatekeeper.
"Notarization" is a process used in security where you want a trusted third party to stamp the integrity and the origin of a document, an application... at a specific point in time to ensure it was not modified.
WD