There can be a lot of confusion regarding this rule and I don't blame coaches, players, fans, and even officials for getting things confused. It is very likely that the NCAA is heading towards adopted NHFS-style rules and banning blocking below the waist entirely in the years to come.
Although there are a lot of technicalities to the rule, this the best way to break it down in a nutshell.
"Lineman and backs in the box can block in any direction except back toward their goal line past the line of scrimmage. For outside guys, it has to be to the outside or straight up the field."
This doesn't cover everything, but it eliminates the vast majority of the penalties that would come from this rule -- and just about any one that a crew of 4 or 5 officials is going to see.