It's possible that this is an error that is specific to my parish, but most often I hear the entire room in which Mass takes place referred to as "the sanctuary." In reality, what they probably mean is the nave.
A sanctuary is the holiest part of a sacred space. It's the place containing the altar (or the high altar if there are several). The sanctuary is the center of the liturgical ceremony, and is set apart by a raised floor, altar rail, distinct decorations, etc.
The nave is the central, open part of a church reserved for worshipers. This word is from the Latin, navis, meaning ship and speaks of the image of the Church as the Ship of Salvation. We members are the passengers being safely guided through the stormy waters of life. Isn't that a beautiful image?