Entering the room, we saw a strange sight.

[lagoo]

Entering the room, we saw a strange sight.

This sentence alone indicates:
1. As soon as we entered the room, we saw a strange sight.
2. While we were entering the room, we saw a strange sight.

I’d like to know which one is more appropriate.

 

[emsr2d2]

It depends on where the strange sight was. If it was inside the room, the first works. If you saw something strange while you were entering the room, that thing could, theoretically, be outside the room but still visible.