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The folks at PhoneArena were on hand in Barcelona to check out the LG G5 in person. They shared this short video that highlights the Always On features of the display.
As FoxKat already mentioned, it looks a lot like the Moto Active Display (which has been in use since 2013). For me personally, I could never go back to a blinking LED notification system. Swipe my hand across my phone and see all notifications and take the appropriate action right there... way too cool. I hate that blinking light on my work phone. Active display / always on display is so much better in my opinion. Good job LG!