I agree that's a characterization of this inner product, but I'm somewhat confused by why this is the right condition. The thing is that "being isometrically embedded" is a property of maps into $V\times W$ (demanding the canonical injections to preserve the norm), yet this is not a coproduct in the category of inner product spaces and norm-preserving maps (there are no coproducts). Meanwhile, "being orthogonal" seems more like a "map out of $V\times W$" condition, e.g. it would be forced by demanding the projections to be norm-preserving, but that's not what this norm does either (and ther…