play BBC HD without descending to a pile of pixelated mush every 30 seconds...

No that is on package. Being on die would be on the same silicion microchip wafer physically next to the core. The memory controller for example is on die. This would not happen anyway as the chips have different process nodes and are made at different factories then assembled on the package elsewhere.

Say you have an Intel Core i7 for example, the memory controller is on die here. On the Core i3 the memory controller is on package because it is with the gpu in a separate chip under the heatspreader not with the CPU core.

Perhaps an image? Fudzilla ran this same story a few days ago with a photo.
Here's the link:
http://www.fudzilla.com/content/view/17371/34/
Sooooo... back to the question.

PJ,,, where do you get 'on-die' from? The article says 'on-board'. This is nothing new.

I can't help but notice that the name ends in the digits "4690", so I wonder if this is more powerful than the 4670's currently offered in laptops?
Since it's MXM, I wonder if it is compatible with most notebooks. The one thing that I did notice (I haven't seen this on laptop MXM cards that I've seen) is the memory chips on the same package as the GPU die.
Any thoughts?