That is the internal contrast of a screen or printed material. I agree, and that type of contrast is important if the screen emits its own light.
However, for outdoors use the only contrast that matters is relation to the real world, aka physical reality. And brightness of course becomes the main factor.
Also, thanks for pointing out you are talking exclusively about transflective/reflective LCD. It seemed to me for a while you were talking about any type of LCD. But even so, eInk and paper has better contrast in real life outdoors use, because we have to measure contrast in the human eye and not within the device.
The human eye adopts to the brightness in the environment and makes a contrast "scale" according to this. The nearer your screen's black color is to the black of the human eye's black in that situation, the better. And the nearer your screen's white color is to the human eye's white, the better.
If either your black or your white is too far from the human eye's calibration, then your screen is no good to use, no matter how good the internal contrast of it is.
There is no limit to how bright things can be or how dark things can be. So the internal contrast between a very deep pitch black and a very dark gray can be 1:10.000, but within a real world sunlit environment it all just looks like black. And this matters, because direct sunlight is 30.000 - 100.000 lux, while an office is maybe 500 lux.