Off the top of my head, I would define Augmented Reality (AR) as the manipulated viewing of our real-world environment and its elements through the use of a computer-based interface.
Last night I found an AR game called Pandemica. Basically there are these strains of bacteria that surround you as you look through your mobile camera. Your objective is to press the screen and shoot all the bacteria before they reach you and kill you. It won an award for best AR game of the year.
I really think that these types of tools would be very useful in education. I found another app called ARgo that creates tags on locations shown on your mobile interface when you look through the camera. The tags show descriptions of each building, statue, point of interest, etc. If you were facing your mobile camera at the Kamehameha Statue, then you would see a tag with a description of the statue and the history of King Kamehameha.
In education, learners can use these AR tools for geography lessons, or have a guided tour to learn about the things in their environment.
Check out Pandemica here:
http://www.youtube.com/watch?v=dtAFb2uF1AA
Here are some AR apps:
http://www.mobileaugmentedreality.info/
Have fun!
Gavon