Basically, this means that when an image is on the screen for too long without changing (like when the 360 is charging), you will end up seeing a "ghost" of whatever had been on the screen. In this case, that means the Moto logo, the charging circle meter, and the hour number for the time. To be clear, the problem isn't quite as bad as burn-in, like you'd find on an old CRT monitor or on newer OLED panels, if an image stays on the screen too long. Burn-in is a permanent issue, but in this case, because the 360 uses an LCD panel, the issue should be fixable.
If you're having this problem with your Moto 360, you should be able to fix the issue by keeping the display off for a while. The other option is to show a moving image, which Android Wear can't do, so you might be able to coax the pixels back to where they should be by shifting through apps or the settings menu. The Convergence watch face may also help out.