Canon means list or rule. The Canon of Holy Scripture is the list of books which are in the Holy Bible. "Bible" itself means library. That's how the Holy Bible got it's name. It is a library of the 72 books containing the Divinely inspired Word of God in Holy Scriptures. I personally prefer to refer to the Holy Bible with either the adjective "Holy", to assure others that it is indeed Holy and not just another human "library", or to refer to the Holy Scriptures as "Scriptures", which means Sacred Writings.
The term "canon" is also used in other contexts in and outside the Church for other phenomena associated with "lists" or "rules". For example, "canon law" or a "canonist" being a type of lawyer.
Yes, it means that, but also much more:
Middle English canoun, from Old English canon, and from Old French both from Latin cann, rule, from Greek kann, measuring rod, rule.]A canon is the standard by which other things are measured. The phrase "it is written" appears approximately 90 times in the New Testament, yet not once does Jesus appeal to tradition or the rules of the religious authorities.
Read Matthew 4 for the story of Christ's temptation by Satan. Jesus certainly could have appealed to Himself, but three times He chose to use Scripture as His final authority. Read also Matthew 15 where Jesus rebukes the Pharisees, asking "why do you break the commandment of God for the sake of your tradition?"
Note that the thrust of Matthew 15 is to religious authorities who used their religious traditions to usurp Scripture. The religious leaders of the day thought that their traditions supposedly handed down from Moses had the same value as Scripture, but Jesus told them that Scripture was the final authority. Tradition is not bad, but tradition that obscures and negates the Scriptures is.
The early Church had ir right when they called Scripture canon, or the measuring rod.