It may be an "e-paper" display, similar to the one Pebble is using. Looking at the Pebble demo videos, you can see that they do support high framerate. Not so sure about the size though.

[1]http://www.kickstarter.com/projects/597507018/pebble-e-paper... [2] http://www.sharpmemorylcd.com/1-26-inch-memory-lcd.html