This isn't really a specific tech toy, but rather a whole category that has started becoming popular lately. The idea is very simple. Basically, imagine a small LCD screen inside a photo frame. Instead of showing just one picture, the screen can cycle through an entire library of photos, making for a dynamic slideshow of sorts.
There are many models out on the market right now. The main differentiators are price and screen size. Obviously, the larger the screen size, the higher the price. On the low end, you can get 5" screens and prices in the $50 range. On the higher end, you can get 8" screens in the $200 range. There are also bigger and more expensive digital picture frames, but I'm limiting this article to the above mentioned price and size ranges. Basically, if you are interested in a digital picture frame, pay attention to a couple of features.
First, get a screen size that will be large enough to adequately display your pictures. 5" screens I feel are too small for most purposes. One exception is displaying the pictures on your desk, as you will be fairly close to the frame so the small screen size shouldn't be a problem. If you can find a good price, go for a 7 or 8" screen. This screen size is usually big enough for display in a living room-type environment.
The second feature to pay attention to is the type of media cards the digital picture frame accepts. Most frames accept a large variety of media cards, but it is best to make sure. Ideally you can re-use your older media cards that don't hold as much data. They are perfect for use in a digital picture frame. To make best use of smaller cards, you can export pictures from your photo organization software in a reduced resolution. Reduced resolution photos don't take as much space, so you can fit a lot more photos on a card than you normally would. Just don't reduce the photos below the resolution of your digital picture frame, or they won't look good.
As always, feel free to contact me if you have any questions about this, or other digital photography topics.