This is an excellent and very important question! Please forgive my somewhat technical answer, but it is not a simple matter.
This rūpa is the same as the “vision of forms” as seen in meditation.
The confusion comes because this is the same or similar to what today we call nimitta. However, the word nimitta is never used in that sense in the EBTs. Rather, in the context of meditation nimitta means “cause, basis”, or more specifically: an aspect of experience that, when you focus on it, tends to support the development of other qualities either good or bad. It is in this sense, for example, that satipaṭṭhāna (mindfulness meditation) is the nimitta for samādhi. In other words, you do mindfulness meditation in order to get into jhāna.
The fact that nimitta is not used in this sense has prompted some to claim that nimittas are unknown in the suttas. But it’s just that a different word is used. There are plenty of places where such visual manifestations are referred to, and they are commonly referred to as rūpa. Indeed, all the names of the jhana realms and so on emphasize the experience of light (gods of refulgent glory and so on), and I strongly suspect that the word jhāna itself is intended to suggest “illumination”.
So that hopefully clarifies usage: but what about meaning? Why use this word?
Well, when we come back to the roots of the word rūpa it is, of course, also used in the sense of “sight, something that is seen”. And it seems that this is a very old sense. The basic idea seems to be that it refers to the manifest physical world; that is, the world as it appears to the senses. In fact, “appearance” is a possible translation.
This contrasts greatly with the western conception of matter as being an underlying substance. This is why we really can’t translate rūpa with “matter” or any similar English word.
Since rūpa refers to the manifestation of physical phenomena in consciousness, the rūpakkhandha can be perceived not only via the eyes, ears, nose, tongue, and body, but also by the mind. When you imagine color blue, it has the property of “blueness” and it is regarded as rūpa. Such rūpa as perceived in mind consciousness is, if you like, an echo or reflection or interpretation of perceptions through the exterior senses. (“Reflection”, incidentally, is another of the meanings of nimitta.)
If we think of the four elements as somewhat similar to the states of matter + energy in the western model, this mentally perceived rūpa would be the upādāyarūpa, form derived from the four elements.
Hopefully this helps clear up not just the original question, but also why we use the word “form” for rūpa. Even though the sense of it is far from transparent, it really is necessary to avoid considering it as “matter”.