This is an unfavourable position for a horse to find itself during the run. The "three wide" means that two horses sit between it and the inside fence, forcing the horse to cover more ground when going around bends.
Furthermore, the "no cover" refers to the fact that the horse isn't sitting in the slipstream of another three wide horse, and consequently expending more energy.
"That jockey absolutely slaughtered my horse! He had him out three wide no cover the entire trip!"
