If your monitor only goes up to 1280*1024, you can't play at resolutions higher then that. (If you have a 17" or a 19" LCD, this is most likely the case) The better the monitor/higher native resolution you have the larger the resolution you could potentially play at. Of course, you'd need to have a good video card to play at those resolutions aswell.
Edit: I just looked at your monitor, it says it's a 1280*1024, so inorder to get a higher resolution, you'll need to buy a better monitor. (like a 20")