This is a really neat stitch. Several of the experienced knitters I asked think it is called tube stitch. Whatever it is called, it is cool. It looks like double knitting (2 layers of stockinette) but there is no purling and you only have to work with 1 color at a time (unlike double knitting where you are working with both colors at the same time).

It looks like a pretty stockinette on BOTH sides, the edges are beautifully rounded and it lays flat without any additional border. The only drawback I can see is that it is somewhat labor intensive because you have to move your yarn back and forth between every stitch (like knit 1, purl 1 ribbing). But well worth it!