Perhaps it would have been better to use the sentence given in the original post.
1) The original sentence
without a "fused relative":
The thing that he did to me was wrong.
Here, the clause "that he did to me" modifies "thing". It functions as an
adjective.
2) The example sentence
with a "fused relative":
What he did to me was wrong.
Here one word, "what", stands for "the thing"
and "that"; "what" is a "fused relative". The clause "What he did to me" is the subject of "was [wrong]". It has a "nominal function" (acts as the subject of the sentence) and is a
fused or
nominal relative clause.
I hope that this was helpful to someone.