Assuming that Apple can source such a display, driving it will be very resource intensive. A dual-core CPU will help, but it will also need a powerful (read power hungry) GPU. I have no doubt that Apple is looking at very high resolution displays for the iPad. That doesn't mean that they'll be able to get it ready for this release, though.
"hints included in the new iOS 4.3 beta seeded to developers earlier this week indicate that Apple may be preparing to move to Imagination Technologies' next-generation GPU architecture with the SGX543 on future devices."
