I think the use of words like "sandwich" really depends on who the NARRATOR is. If the narrator is a part of the fantasy world, then they should be using the appropriate dialect. However, if the story is being told ABOUT the fantasy world and not FROM it, like a lot of fantasy is, then I think translation can cover this. Yes, the fantasy world doesn't have sandwiches, but the narrator does, so he doesn't spend a paragraph explaining that these are two pieces of bread stacked with foodstuff between them and blah blah blah, he just says "sandwich."
In third person omniscient, the same rules don't have to apply to the narrator as to dialogue. Honestly, this is something that drives me crazy with fantasy readers and writers. Why is using the English language fine, but using English words isn't? I get that you have to draw the line somewhere, but I think most people draw it too firmly.