The new iPad sports a 9.7-inch, 2048x1536, 264ppi Retina display, which is twice as dense as the iPad 2's equal sized, 1024x768, 132ppi screen but packs four (4) times as many pixels into the same space. That's exactly what it sounds like -- the new iPad has 4 pixels in the same space the iPad 2 had a 1 pixel.
Theoretically, that means the pixels on the new iPad display are so small they're difficult if not impossible to discern with the naked eye during general use. Hence the marketing name "Retina". It's roughly the same effect as when you compare cheap newspaper or old comic print next to a high end glossy magazine. The information becomes so densely packed that the mechanics disappear and only the content remains. Everything looks sharper, crisper, more solid, and more real. If you're not a trained typographer, photographer, or designer, it's still something your eyes and brains will appreciate even if you can't articulate it.
Now there is one important caveat: For things like fonts and built-in user interface controls, Apple's iOS will handle the scaling automatically. For bitmap graphics, like PNG files in icons or custom user interfaces, designers have to create the new, higher density artwork or iOS will simply render the same lower-resolution image using more pixels. (Think watching standard definition video on a high definition screen).
Still, the original iPad was amazing when it first launched. I called it the iPhone gone IMAX and that's exactly what it felt like. The iPhone's then 480x320 screen just seemed small and cramped by comparison. But then Apple introduced the iPhone 4 and the 960x640 Retina display and everything changed. Suddenly small was sharp and cramped was clear, and while the iPad and even the iPad 2 was still bigger, the display wasn't better. It was quantity but not quality. Seeing and reading and watching on the iPhone was harder but suddenly more relaxing and enjoyable.
Some people have used the metaphor of putting on glasses -- of the Retina screen being so good it's like they can focus for the first time. That's not entirely it though. I have a feeling the Retina display goes deeper than that. It's good enough your brain no longer has to work at filling in details anymore and it can just relax and enjoy. It can just see and read and watch.
Now the iPad has it as well. Once again it's bigger and better. It's not small but it is sharp, not cramped but it is clear.
For me, it will be hard if not uncomfortable to go back. It will be rough and bumpy and almost clumsy. And given how good the iPad 2 display is, that's a hell of a thing to say. (I'm typing this on a MacBook Air, which has a fairly dense display in its own right, and now I find myself acutely and annoyingly aware of the sub-pixel anti-aliasing.)
The difference between the new iPad and the iPad 2's display isn't as much as an old Standard Definition (SD) TV and a 1080p High Definition (HD) display, because for most people that involved the simultaneously jump from CRT tubes to LCD or Plasma flat panels. But it's more than the jump from 720p to 1080p display. It's like going from iTunes SD movies to iTunes HD movies. Everything is smoother but more textured, cleaner but more detailed.
I remember watching Lord of the Rings in HD for the first time, amazed at how much more there was to see. That's the same feeling I have with the new iPad, watching the Avengers trailer in 1080p (in a window, since 1920x1080 doesn't even fill the new iPad display).
It's not the Martix's "welcome to the real world" or even Vader's "with my own eyes", but for anyone who cares about image quality, typography, iconography, art, or HD video, it's very much in that geeky vein.
Since it's harder to show the difference than it is to just write about it, I put a macro lens on my iPhone 4S and took some close up images to try an highlight just what that many pixels look like. Holding the new iPad at a distance, you don't see the pixels, of course. You just see the content. That's the whole point.
Apple has made the best panel I've ever seen, and while not everyone will appreciate it, or even care about it, that takes nothing away from the achievement.
I've jotted down some more thoughts in the new iPad forum, so jump in there and let me know what your experience has been with the Retina display.