I've yet to study the linked patent so can't say if that solves it but it's not as simple as just a layer of LCD pixels, as they would not be in focus.

It's sort of the same as the light-field generation problem - to generate images at arbitrary depths you need to control both the colour and direction of light rays. To generate sharp occlusions at arbitrary depths using a single 2D "masking" layer will require the layer selectively passing or blocking rays depending on their direction.

The patent mentions variable diffraction gratings, which I suspect might be part of the solution to controllable opacity based on ray directions, but I don't know enough about optics really to say for sure.