nope, its your video card driver preventing it then... I know you're using Nvidia but each driver has a slightly different setup interface...
from the NVIDIA control panel, under display you should see something along the lines of "Set up multiple displays" from here its pretty self explanatory. your best bet will be DualView.
Also, have you connected the external monitor and then reboot? Give that a shot and try the first thing again
Also, to force the windows default to be effective you can connect the external monitor, hit reboot, then close the lid on the notebook before it comes back up. this should force it to use the external monitor but i bet you want extended desktop set up.