Well.... the Matrix actually used the name from the anime. THe meaning of gundam off wiki:
"In the early stages of production, there were numerous references to the word freedom, such as the White Base being originally named Freedom's Fortress, the Core Fighter as the Freedom Wing, and the Gunperry named the Freedom Cruiser. The collective Yadate team combined the English word Gun with last syllable of the word Freedom, Dom, to form the word Gundom. Tomino then changed the name to the current title Gundam, suggesting that the name Gundam signifies a power wielding a gun that is strong enough to hold back enemies like a dam holds back floods."
You are right... Gundam is big robotic body extensions. Thats a techinical way of looking at it. THey are really just a big robot with a human inside. Kinda like mech-warrior but much cooler with lasers and can fly and such.