How to interpret "...the disinfectant burnt her inside out, of course"

Solution 1:

It's one of those sentences that is grammatically ambiguous, but semantically clear.

I shot the man with the blue shirt.

You can parse this in two ways:

1. I used the blue shirt to shoot the man.

2. The man with the blue shirt was who I shot.

Both are correct interpretations of the sentence's grammar, but #1 is obviously wrong because a blue shirt isn't something that can be used for shooting.

Likewise, the girl was not inside out, that doesn't make sense (probably). She was burnt from the inside out.

Solution 2:

A third option is to interpret inside in the sense of the OED's definition 2b of "inside, n.":

The interior of the body; the internal organs, esp. the stomach and bowels; the entrails. (Also in pl. in same sense.) colloq. and dial.

In this case it would have the meaning that the disinfectant burnt out her internal organs.

Nowadays it's more common to use the plural insides for this sense, but I have also seen inside.