What does 'chrome' mean?
It is a euphemism for the graphical framework and elements surrounding the content, and thus means different things depending on the context.
In the context of a web browser it is the navigation, toolbar etc.
In the context of a website it is navigation, ad-space and other fixed aspects of the design.
The term "user interface chrome" is synonymous with "graphical user interface" or GUI for short, a term you are probably more familiar with.
In the context your are referring to in the browser.type documentation, it is actually just a way for the XUL framework to load privileged content via a URI. The name here may seem a little misused, but for the most part, this is the way the XUL framework loads all graphcis used to build the browser chrome, and as such it goes well with the first context i described.
The chrome is the window around your application. It is the browser window itself (borders, navigation, address bar, etc).
The chrome is the browser frame, including all of the code and UI in the browser itself.