What is meant by work done "expanding against atmosphere"?
Imagine someone was pushing you against a wall. If you spend some energy overcoming that push, wouldn't you say that you did some work (expenditure of energy) against that pressure?

With a similar line of reasoning, the atmosphere is exerting a pressure of one atmosphere trying to compress your gas down. That's a huge pressure (nearly $10^5$ pascals!) and the gas in question has expanded against it. The wording makes sense.

In general, whenever gases are produced as a result of some reaction (in this case combustion), they are initially at a higher pressure than atmospheric pressure. This isn't an equilibrium situation. So, they expand, and lose their pressure until it finally becomes equal to that of the atmosphere.