High resolution means you can hear the guitarist's fingers sliding on the strings, the reverb tail fading into silence, and the subtle breath intake before a vocal phrase. Resolution depends on: low noise floor, low distortion, accurate frequency response, and good transient response.
Resolution is often confused with sample rate (high-res audio = 96 kHz+). In practice, 24-bit/48 kHz provides more resolution than any human can perceive — the bottleneck is almost always the speakers/headphones and room acoustics, not the digital format.