The web site tw.apple.pro, perviously responsible for accurate discoveries of components for the iPhone 4, claims to have received this component from a reliable source. And the Apple branding on the part suggests that at least it is an Apple prototype part.
9TO5Mac have a great little concept sketch from one of their readers.
What do you think a 3cm x 3cm LCD panel could be for? Let us know your best guess in the comments.