Depending on your video card you may not be getting better resolution on your monitor when you play DVD's. Just because the monitor is capable of higher resolution it is up to the card to drive it higher.
The colors are off because computer monitors are set up to different color temperatures than TV's. Most monitors default to 9300 deg.
9300 deg. K is the standard "computer monitor" white, and gives the highest absolute luminance but is distinctly bluish in color. Every common desktop monitor that I know of defaults to 9300 deg. K color temperature.
6500 is generally considered a "whiter" white, and is often referred to as "daylight" white. It's the standard white point used in the TV industry, and so is the best choice if you're displaying video on your computer monitor. You gamers may want to check this out, flesh tones are better etc.
Another common "standard" white is 5500 or 5000 deg. K, a bit redder than 6500 and often called "paper" white. As you might guess, it's most often used in document review or photographic and pre-press applications.
Check the user manual for your monitor, it will tell you how to change color temp.