In-chain refers to something that is stored and processed on the blockchain, while on-chain refers to something that is stored on the blockchain but processed off-chain. In the case of NFT artwork, in-chain would refer to the media being processed to its final form by the first execution layer, such as the EVM in Ethereum. On-chain would refer to the media being stored on the blockchain, but the processing and rendering of the artwork happens off-chain using JavaScript, for example, in real-time.