Learn Hardcore Dutch: De kabel zit los.

Dutch often uses “position verbs” to describe how/where something is situated. Zitten can mean “to be fixed/inserted/held in place.” With things that are supposed to be attached (screws, cables, buttons), Dutch commonly says they zitten loose or tight.

De kabel zit los suggests the cable is in its socket/holder but not securely; it wobbles or can be pulled out easily.
De kabel is los is a more general state: it’s loose/free, possibly (fully) detached. It’s fine, just less specific.

Is this actually the separable verb loszitten?

Yes. Dictionary form: loszitten (“to be loose/not firmly attached”). In main clauses the prefix separates:

Present: De kabel zit los.
Past: De kabel zat los.
Perfect: De kabel heeft losgezeten.
Subordinate clause: …dat de kabel loszit. It uses the auxiliary hebben in perfect tenses.

What does zitten mean here? It doesn’t look like “to sit.”