Firefox still presents the lambda sign, doesn't translate it to punycode, Chrome does tho, maybe this should be reported to Chromium devs?

Some non-English characters look too similar to - or even exactly like - some English character or another. So that you will know that is not an actual English character, you see the punycode.

You notice that isn't ".com" or even ".uk" or one of the more common top-level domains? The more common TLDs prevent people from registering domains using confusing letters. Since they do, Opera would show you λ in λ.com (if there were such a domain), but as .pw makes no assurance about confusing letters you get the unambiguous punycode.