The way they make the display feel like glass is because it (kind of) is. Originally folding phones used polyamide (a type of plastic) for the cover layer of the screens, and these had a plasticity feel to them, but some newer foldables use UTG (ulta thin glass) basically a glass-like material that is so thin that you are able to fold it.
The other part of the screen below the layer you interact with are made with materials that are also flexible.
You can find a more detailed answer here https://www.androidauthority.com/how-do-folding-screens-actually-work-3164822/
The materials used in foldable screens were specially designed to be able to fold without breaking. Because the surface material is also the outside of the hinge, there is no gap to hide.
The image doesn’t distort because nothing is changing in the way the image is produced. It is still being created by millions of LED lights under the screen; they have not moved relative to the screen so there’s nothing to cause distortion.
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