My friend Raymond from DisplayMate posted the first review of Apple's Watch display. It's a great article and well worth a read. His main conclusion is that the Flexible OLED display is excellent, and Apple did a very good job in its implementation. In fact Raymond says that "there is absolutely no question that for smart watches, OLED is the only way to go for a great display".
The OLED provides very nice and accurate colors and a pleasing picture quality. It compares very good to the iPhone 6's LCD display. DisplayMate tested a single edition, one with a Sapphire display (more about this below). This is a 42 mm panel (312x390, 302 PPI) - most likely made by LG Display.
The major problems with the Watch (this is also true for all other smartwatch displays so far) are limited display Brightness, the performance in high ambient light, display power management and the running time on battery. While the Watch is excellent under low indoor ambient light, it's aggressive mandatory display brightness and power management strategies significantly restrains the display’s brightness under high ambient light and can get rather annoying.
Glass or Sapphire?
There are several Watch editions - the cheaper ones (the Sport Edition) use a strengthened glass (same one used in the iPhones and iPads) while the more expensive editions use sapphire. Sapphire major advantage over glass is that it is virtually scratch-proof. But sapphire also reflects about twice as much ambient light as glass. Sapphire also has a much higher optical depth then glass - which means that the brightness is lower on a Sapphire display - in fact Raymond finds that the Apple Watch experiences a 32% brightness decrease compared to other OLED devices. It also suffers from larger color shift which is noticeable at 45 degrees and above.
While DisplayMate did not test the Sport edition with a glass instead of a sapphire, it's quite safe to assume that it will have a much better display. So if you plan on using your Apple Watch outdoors and want a good display, you probably want the Sports edition and not the more expensive ones.