The demonstrative pronouns "isto/isso/aquilo" are neutral. The reason "isto" rather than "este" is used in this sentence is probably because it was meant to be the answer to a question like "O que é isto?" which is one way to ask "What is this?" when you don't know anything about the thing you are asking about. For example, the sandwich could have been in a paper bag and you couldn't tell that it was a sandwich (and therefore a masculine thing) initially.
Isto/isso/aquilo are stand-alone words. They substitute nouns.
Este/esse/aquele (and inflections) are pointing-to words. They point to something.
You can say "isto" or "este sanduíche", but never "isto sanduíche".
Saying "isto é um sanduíche" = "this is a sandwich" = "it is a sandwich".
Saying "este é um sanduíche" sounds like "este (hidden noun) é um sanduíche" = "this one is a sandwich"
I'm sorry, I'm not a native speaker, but I guess if I was answering a question like "O que é isto?" I would answer with "isto" because although translated as "this" here, it is just as likely to be translated as "it". To me the choice is not between "this" (masculine) and "this" (neutral) it is between "this" and "it": You: "What is this?"; Me: "It is a sandwich".