Nice view. That cam does a great job of seeing the big picture but I agree the fine details at a distance are lost with such a wide angle view.
First things first:
Your resolution is set to 1 megapixel. You should have it at 2 Megapixel (1920x1080) or 3 Megapixel (2048x1536). Which of those you choose is up to you; the 2 Megapixel video is a little wider and the 3 Megapixel is a little taller but less wide. (3 megapixel has the highest pixel density too of course)
That will be the biggest improvement.
Then go ahead and double the bit rate, assuming you have it on a wired LAN that won't hurt anything and it will only help maximize your image quality. I personally prefer constant bit rate over Variable bit rate but thats just me. You can easily experiment with both and see if you can tell the difference.
Dropcam is only 720p and has a very wide field of view similar to that Hikvision with the 2.8 mm lens, so there is no reason the Hikvision's video shouldn't be at least twice as detailed.
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For a higher-detail picture on the cheap, you could buy a Hikvision with a longer lens. Some of the models come with up to 12mm lenses available upon request, and that is a much higher zoom level.
The best zoom however comes from PTZ cameras. You can get a 2 megapixel PTZ with 18 to 20x zoom (equivalent to about a 100 mm lens) for close to $600 from china (purchased from ebay or aliexpress) If you want to buy from a US-based seller, expect to pay at least twice that for something with equivalent specs. Just as an example, look at this one:
http://www.ebay.com/itm/20X-HD-1080...eillance_Security_Systems&hash=item27d5e75355 -- I'm not sure I would trust that particular listing, as the item details are inconsistent with the listing title, but there are lots of other similar cameras on ebay.