Why does HD video look like normal video on 1080p monitor?

Blu Ray discs have a digital copy protection scheme called HDCP (High-bandwidth DIGITAL Content Protection) built into them. To play back blu-ray discs in full 1080p HD on a computer, you need an HDCP-compliant video card AND an HDCP-compliant monitor, using a digital connection like DVI or HDMI.

VGA is ANALOG, so by definition it is NOT HDCP-compliant (since HDCP is a Digital thing). That is mostly likely why your blu-ray playback looks like low-definition and not full 1080p high definition.

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if you want to maximize your video output, then get a HDMI cable, especially if you have a good video card.

If you don't have a video card but you have a 1080p monitor, then it isn't as important.

HDMI cables can send alot more information at a time than VGA cables.