So it's triggered as a reaction: anytime an enemy you can see within 60 feet makes a successful attack (that Cutting Words could prevent?) or a damage roll, you get a prompt to use Cutting Words? And then that enemy subtracts 1d6 from said attack & damage roll, and any other attack and damage rolls during that same turn?
I think that's the assumption from how they explained it, yeah.
I now realize that the new Cutting Words in both BG3 and Solasta would be incredibly powerful against enemies capable of making multiple attacks in a single turn.