By the original definition, losing to a "sandbagger" meant that you got beat badly by someone who did not previously exhibit the level of skill they showed against you. It could be that they were purposely hiding their skill before playing you (hence the devious / hustler / cheating connotation), but in reality this could also happen simply because your opponent has natural variance in their play and you happened to play them on one of their especially good days.
It's like when you get crushed by someone, and then look up them up expecting to see that they have a stellar W/L record, only to find that they have lost a lot of matches, maybe even lost to players who you have beaten. Of course this is annoying and you find yourself temped to accuse them of tanking those other losses. It's maybe more comforting to think that way, rather than the alternative explanation that your opponent was feeling great against you, or that you played badly.