Brief thought about holiness - set-apartness

Thought of the day from morning prayers:

The word kadosh (Hebrew usually translated as "holy") means set apart. G!d is holy because G!d is set apart - and by extension, so are we.

Yet, in the words of the seraphim in Isaiah's vision in Isaiah 6, it says that the whole world is full of G!d's glory.

This line appears three times in the Jewish morning liturgy and the first time, it's in the middle of the blessing before the Shema praising G!d for creation.

So here is my thought - what if G!d's set-apartness, G!d's holiness, is G!d's immanence - G!d's presence in the world - NOT G!d's transcendence? Perhaps the angels see G!d as set apart from them precisely because of G!d's presence in the material creation.

Which means that our holiness lies not in transcending or running away from material creation, but in embracing and deeply engaging in that material creation - that we are set apart to be holy material creations?