I've heard in that used as a synonym for because, but I don't think that this is semantically correct in all cases.
That car is nice, in that it is blue.
This sentence generally makes sense to me, but it also sounds funny. But I don't know enough of the technicalities of English to diagnose the problem.
It's hard to research this because I don't know what the correct part-of-speech term is for in that. I want to call it a phrase but I think some of you will cringe if I do this.
Can someone give examples of when and when not to use in that, or point to a resource that can explain it?