It means that GOD is ONE and is omnipresent and indivisible, i.e. there is nothing else in existence that is not of GOD.
I do agree with your sentiments, but I wish to take it a step further. What I mean is [if] God is everything, then there can be no evil as many define evil today. Even so, mankind are but a tiny part of Gods reality, and we are subject to certain physical and spiritual laws. If evil does not apply to man, then there can only be what is wise and what is unwise for mankind.
For any consciousness whatsoever that sees its self separate from God, it has fallen from the non-dual 'heavenly' realm into the error/illusion of a conceptual dualistic reality,..and its all the way down hill from there.
Perhaps God exists both within and without, yet we (Mankind) are still subject to the universal law of cause and effect.
Every human soul has the potential to realize what and who they really are, and when they do, they too will be able to say the Father and I are ONE.
I think that all are one with God; and that we are not, nor can we ever be separated from Him, except in our own minds.
Until then, well so long as they see reality in dualistic terms, then they are still 'eating' of the metaphorical fruit of the tree of knowledge of good and evil (duality) and hence live a mortal life that is constituted conceptually of complimentary opposite experiences, i.e. happiness and sadness, pleasures and pains, good and evil, etc..
Life consists of pleasure and pain, just as it consists of positives and negatives, but it is true that they are experienced subjectively by each individual. If a person is bludgeoned over the head with a baseball bat, then for most people that would be a painful and negative experience, no? So .... Where does all this leave us in terms of what is best for us as a peoples? A house divided cannot stand after all, so either we embrace both the negatives and positives, along with pleasure and pain or we resist one and love the other, right?
What I'm suggesting is that we can grow, and learn, and come to realize what is and what is not wise for mankind through our experiences. The lasting positives in life are like a rewards from God, but the negatives are like corrections from God. I'm reminded of a couple passages in the bible:
"My son, despise not the chastening of the LORD, neither be weary of His correction" Prov 3:11
"Correction is grievous unto him that forsaketh the way, and he that hateth reproof shall die."
All things when embraced and learned from can lead us to follow the path of righteousness, but those who hate correction will never learn, and will likely continue on their path of destruction. Good and evil then (As it applies to mankind) is simply the difference between acting wisely or unwisely. One way is a tree of life, whereas the other way leads us to death.
"Happy is the man that findeth wisdom, and the man that getteth understanding. For the merchandise of it is better than the merchandise of silver, and the gain thereof than fine gold. She is more precious than rubies: and all the things thou canst desire are not to be compared unto her. Length of days is in her right hand; and in her left hand riches and honour. Her ways are ways of pleasantness, and all her paths are peace. She is a tree of life to them that lay hold upon her: and happy is every one that retaineth her." Prov 3:13-18
Tre-L