See Using Metaroles for Policy Configuration page for a more specific examples of approval policy specification in a metarole.
Display names of roles and orgs are used by midPoint user interface whenever possible. In case that display names are not available, ordinary object names are used. So midPoint always has something to display to the user. However, it is recommended to use display names. Firstly, ordinary object names are required to be unique. This requirement usually leads to a very complex naming convention for roles that is not entirely user-friendly. There is no such requirement for display names. Therefore display names can be used almost freely to provide a meaningful information to the user.