The term expresses a state of extreme uselessness, which can be understood by considering the functionality and worth of soup between two slices of bread.
So the implication here is that the object of discussion is 'Fucked up like a soup sandwich.'
Equivalent expressions in the civilian world are:
Tore up from the floor up.
Useless as tits on a boar..
and so forth.
Drill Sergeant: "You are the lowliest goddamn example of hot garbage I have EVER seen. You look like a goddamn soup sandwich, that uniform looks like you pressed it under your mattress springs, and those dusty ass boots look like you shined them with a snicker bar and a goddamn green pad. That is goddamn un-sat, Private. Report to my office immediately following this formation to be skullfucked appropriately."