You heard right; you can legally sleep in your car in a lot of places in the US. In some places (e.g. Texas), your car is legally considered a part of your house. However, a few cities treat sleeping in your car as a crime, so it's worth researching before spending the night in a city.

There are quite a lot of people living in their cars on BLM land. BLM requires that you move periodically (e.g. 150 miles every 2 weeks), but how far and how long depends on the location in the BLM system.

Bob Wells is a well-known advocate for this lifestyle. He's got tons of videos about living in cars, trucks, vans, etc.