What causes multiple bilateral lung nodules. The largest one is 5 mm and all the doctor wants to do is follow it. Why not biopsy it and find out why?

Many things. Depending on where you live this can be an old infection called histoplasmosis. 5 mm nodules are quite small and biopsies may not be easy at this point. Also a surgical biopsy of the lung isn't a simple outpatient procedure. If you are concerned you can also get a second opinion.
Not yet. 95% of all pulmonary nodules found are benign. It becomes more imperative to move to biopsy when the nodules are larger than 7mm. Until then, the chance of hitting a 5mm nodule is poor at best. Since you have multiple nodules, you would have to figure out which one to biopsy. Not an easy task. If one of your nodules grows between ct scans, you now know which one to go after.