Can't they slice the image into many small parts, group them into N groups, then flash each group for 1/Nth of a second, essentially creating a looping video out of an image? A screenshot would then only take the current frame buffer, which would be only a part of the image and hopefully not useful. The image would have ghostly appearance, but it'd offer much better protection. OTOH, this sounds like an overly-complicated technical solution - after all notification only is much simpler and seem to offer a "good enough" solution.
*of course, it'd be very hard to protect anything when sending bits to someone else - someone can patch the app to get rid of the timer, dump the image to disk etc etc.
HN discussion: http://news.ycombinator.com/item?id=4955639