Dot matrix display is a rectangular grid of pixels (usually redstone torches, pistons or trapdoors), where each pixel can be controlled individually. The advantages of using these over 7 segment displays is that you can easily modify the size, shape and what is shown on the display. The downside is that decoder is much larger than for 7-segment displays.
Main page: Decoders
For the most simplest design of decoder for this display, it can take one input and produce infinitely as may pixels as desired, either in their on/off state. In the Photo shown at right, a hexadecimal to 5x5 pixel display has been created. There are 16 decoders, one for each number and the span along all 5 layers of the busses carrying the signal. In the next photo, you can see how each individual pixel is controlled.