3rd dimension?
I'm not sure why you are discussing "a 3rd dimension isn't needed". I didn't mention any 3rd dimension.
Perhaps you were distracted by my phrase "each of the three directions"? I explained what that means, but let me try again, now armed with an additional resource:
The conventional term "aspect ratio" means ratio between width and height. However, if indeed the Save as Mesh "Aspect Ratio" setting is constraining the "aspect ratio" of triangles, then presumably it would inspect width and height for each of 3 cases: treating each side as the base, compared to the height for that case. All three of these cases should be constrained. This is the "3 directions" I mentioned. Nothing to do with the 3 dimensions of space.
I now see that there are numerous different definitions for aspect ratio applied to triangles:
"How different simulation softwares calculate Aspect ratio for 2D Elements"
https://www.engmorph.com/2d-element-aspect-ratio-diff-simula
Some of these methods separately inspect the 3 cases, others have a single formula. But ultimately all the algorithms provide a measure of the degree to which the shape of the triangle is "long and skinny" as opposed to closer to equilateral.
Changes advocated
I'm not advocating for any treatise on the tessellation algorithm. I'm simply advocating for the UI label and docs to not be actually wrong. A minimal change would be for the UI label to change from "Aspect Ratio" to "Max aspect ratio" [edit: or maybe "Aspect Ratio Limit"], with perhaps the hint saying "Maximum allowed aspect ratio for mesh triangles."
It would be great if the documentation of this dialog at least did not claim that this setting sets the aspect ratio of the triangles in the mesh, which is false. Instead it should say that it constrains the meshing algorithm to aspect ratios less than this limit.
The docs could spell out why you might want such a limit, providing some clue to users how to reason whether they want a larger or smaller value. Allowing them to actually use with dialog and setting deliberately.