You're understanding that perfectly.
The CaptureDamage/CaptureWait stuff is the mechanics behind being grabbed that allows wobbling and doubles infinites (1 player grabs, other drill shines/ rapid jabs etc) to exist.
Once you've been hit in a grab, you are placed into CaptureDamage for 20 frames. You cannot escape a grab during this time. Once that has ended, you enter CaptureWait, and if you've mashed enough buttons you immediately start escaping, the wobble has been dropped. CaptureWait doesn't have a set time, it's based on damage and total buttons mashed while in the grab. If you grab someone at 0% vs. at 999% the CaptureWait window will vary.
Worth noting is that button mashing is buffered, meaning that if I mash a ton while I'm getting wobbled 0-100%, and then stop mashing, if my opponent stops wobbling at 200% I'll still escape. Obviously I wasn't mashing from the most recent hit of the wobble to the first whiff, but my previous mashing buffered and I get an immediate release once I enter CaptureWait.
A playthrough would go like this.
Grab, (not enough mashing to escape) pummel (some hit stun is incurred by both Popo and the victim of the grab [not Nana], so they're chilling for like 3 frames) victim enters Capture damage 1, 2, 3... time passing... 14 Boom Nana F-tilt or something (Nana and victim enter hitstun for the hit while Popo continues doing whatever), victim enters Capture damage 1, 2, 3... time passing, 10 (pressed A here to get Popo to pummel it will hit frame 23) 11, 12 ... 19, 20, BOOM ESCAPE! Opponent slides away and stuff. Pummel was started, but Popo takes a while to swing that forehead, so the opponent escapes before it connects and both Popo and the victim go into 30 frames of grab release lag, Nana does whatever, probably repeated taunts or an SD.