My OS knows the resolution of my monitor...
Your OS knows the resolution of your monitor in the true sense of "resolution": The actual amount of information (i.e.; the number of pixels).
But your OS does not necessarily know the scale of those pixels (i.e.; the physical measure of the monitor pixels). For example, Windows 7 works on a tiny netbook monitor which has the same number of pixels as a cheap bulky desktop monitor, on which Windows 7 measures much larger.
Or, think of a presentation projector. It projects a fixed number of pixels onto the meeting room screen. Windows 7 may know how many pixels are being projected, but it has no idea how far away the screen is, therefore no idea how large those projected pixels actually are. An inch of Illustrator's rulers at 100% may very well measure 6 inches on the projector screen.
Since the beginning of desktop publishing, popular use of the term "resolution" as if it is synonomous with PPI (Pixels Per Inch), has led to much confusion. Imagine a satellite photo of a license plate. Let's say only 24 pixels span the width of the license plate, so the license number is not legible. Will doubling the PPI of that image (i.e.; scaling or zooming to 50%) make the license number more legible? Of course not. "Per Inch" is nothing but a scale factor. The actual "resolution" of that photo is all about count of pixels per license plate, not their size. Only enabling the satellite camera to capture more discrete color samples (pixels) at the same distance will increase the photo's resolution.
JET
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