Update: OK, maybe not thesaurus. Results we got were close in spelling only. Meaning was coincidental.
Think of it as half spell check and half thesaurus. The new iPad Safari has a feature that when you select a word, you get the option of “Replace..”. If the word is spelled incorrectly, you get a few spelling choices. If it is spelled correctly, you get the option of a few similar words.
If you spell something incorrectly, you simply have to tap on the word and it goes pink with suggestions: