Sean, I believe that the local text index is part of the Oracle Text feature of Oracle that is specific to working with documents, such as Web sites, digital libraries, document or warehouses. While the Domain Indexes are indexes that we use in day-to-day.
The following documentation will be helpful:
About Oracle Text:
http://docs.oracle.com/cd/B28359_01/text.111/b28303/overview.htm
(In the third chapter there is information about the indexes)
About the Domain Indexes:
http://docs.oracle.com/cd/B10500_01/appdev.920/a96595/dci07idx.htm