Safari on iPad 3 via Air Display - regular vs Hi-DPI modes
In the first (leftmost) screenshot, the iPad is running at its native resolution of 2048 x 1536 pixels, resulting in a large external display (which makes everything look tiny on the 9.7"-diagonal iPad 3).
In the second (rightmost) screenshot, the iPad is being treated as a Hi-DPI display by OS X Lion, which is similar to the "Retina Display" concept - i.e. the screen acts as a double-resolution 1024 x 768 screen, resulting in everything being larger but also much smoother (thanks to OS X's Hi-DPI support).
You can enable Hi-DPI mode by using the Quartz Debug application which is part of the Graphics Applications package of downloadable developer tools, available from within Xcode.