You can easily see one millionth of an inch. During my training as a Mechanical Engineer we did some work at a metrology lab. We used what in the US is called a Gauge block http://en.wikipedia.org/wiki/Gauge_block . If you set two gauge blocks by one millionth difference you can see the light between them. Also don't forget the human eye can see as far as a few light years - think stars!

By the way the Wikipedia article on Gauge blocks is also very inspirational for any aspiring inventors/enterpreneurs.

Current silicon retina, which exploit similar event-based "pixels" (as opposed to frame-based scans), are way below the eye's resolution, but can still do so much:

http://siliconretina.ini.uzh.ch

Makes me wonder what the tiny composite eyes of insects can do in a complex environment like a forest.