Is the “_s” on this `sprintf(__(‘Page %s’, ‘_s’), max($paged, $page))` just refer to a text domain?

Yes it is. It might get a bit clearer if you re-format this line

$title .= " $sep " . sprintf( __( 'Page %s', '_s' ), max( $paged, $page ) );

to:

$title .= " $sep ";
$title .= sprintf( 
    __( 'Page %s', '_s' ), 
    max( $paged, $page ) 
);

The first parameter of sprintf expects a format which is here the return value of the __ function. The second parameter of this function is meant to be the text domain.

Update:
In fact, I think its the default text domain from the starter theme »Undersorce S« from where the example code in the codex might come from.

Update 2:
There you go: it looks like the sample from the codex was taken from the function _s_wp_title. The _s in the function name was replaced by theme_name but the text domain obviously was missed out.