That's the name for a turnout in which the points and adjacent stock rails are at the same polarity. This requires that the turnout frog be isolated from the closure rails.

Frogs may be dead (unpowered) or live. A live frog will require that the switch machine for the turnout have a pair of electrical contacts that can be wired to connect the frog to the proper output of the power supply.

The chief advantages of a DCC friendly turnout are:

• When a conventionally wired turnout is thrown to the diverging route, it becomes possible for metal wheels of some (long wheelbase) locomotives to "brush" against the back of the open point. This creates a short-circuit which will cause the short detector built into DCC boosters to shut off (shutting off protects the booster, your wiring, the trackwork and locomotive from enough electic current to make things get really hot). Digitrax booster emit a "beep beep beep" sound when this happens. All trains being powered by that booster will stop when this happens.
  
  When the point and its stock rail are wired together there is no potential for short circuits. The NMRA specification for how far a turnout point must be from the stock rail when it is open was created to prevent accidental short circuits. It's a huge (by prototype standards) distance. On a DCC friendly turnout, the open points can be just far enough from their stock rail to let the wheel flanges pass through.
  
  
• With a dead frog, trains running through the turnout on the wrong leg don't cause short circuits.

Absolutely. DCC friendly really is a mis-nomer. Perhaps a better name would be "short circuit resistant".

If the points are tied together at their heel and/or toe by a metal bar that turnout is not DCC friendly (or short circuit resistant).

DCC friendly turnouts can sometimes be identified by gaps in the rails around the frog.

In general older turnouts are not DCC friendly.

Another test is to use an Ohm Meter. This device lets you measure the electrical resistance between two points. The measurements are made in "ohms" (named after a pioneer in electrical research).

0 (zero) ohms is a short circuit.

An open circuit (no connection) is an inifinitely high number of ohms.

With the turnout on your work bench (not connected on your layout), throw it one way. Measure the resistance from each point to its adjacent stock rail.

Now throw it the other way and measure resistance from the points to their stock rails again.

If all resistance measurements are very close to 0 ohms then this is a DCC friendly turnout.