It's some sort of special display that was created just for the OLPC. It has an adjustable backlight. When the backlight is turned on all the way the display looks like a regular laptop display, but when it is turned off all the way, then the display looks like an e-Ink display.
Unfortunately, it does not compare with the e-Ink displays in terms of low power usage, but it is good enough for long reading sessions without straining your eyes.