Con esa luz, el vestido parece azul.

Yes, con very often means with, but in Spanish it can also express the conditions under which something appears or happens.

So Con esa luz literally means with that light, but in natural English we usually translate it as:

• In that light
• Under that lighting
• With that lighting

Here it means that the lighting affects how the dress looks.

You could think of it as:

• Con esa luz, ... = Given that lighting, ...

This use is very natural in Spanish.

Because luz is a feminine noun:

• la luz
• esa luz

The demonstrative has to agree with the noun, so:

• masculine singular: ese vestido
• feminine singular: esa luz

Also, este and ese are different demonstratives:

• esta/este = this
• esa/ese = that

So:

• esta luz = this light
• esa luz = that light

The comma is used because Con esa luz is an introductory phrase placed at the beginning of the sentence.

So the structure is:

• Con esa luz, = introductory circumstance
• el vestido parece azul = main statement

In English, we often do the same:

• In that light, the dress looks blue.

The comma is very natural here, though in some short Spanish sentences punctuation can be flexible. In careful writing, the comma is a good choice.

Spanish usually uses an article more often than English does.

So where English might say:

• the dress
• or sometimes just dress in very reduced contexts

Spanish normally wants:

• el vestido

Leaving out the article here would sound incomplete or unnatural.

So:

• el vestido parece azul = the dress seems/looks blue

Because the sentence is talking about appearance, not definite reality.

• El vestido es azul = The dress is blue
• El vestido parece azul = The dress seems blue / looks blue

That difference matters a lot here, because the phrase Con esa luz suggests that the color may only appear blue because of the lighting.

So parece is the natural choice when something only seems a certain way.

It can match either one in English, depending on context.

Here:

• El vestido parece azul can mean
  • The dress seems blue
  • The dress looks blue

In English, looks blue is often the most natural translation when talking about visual appearance, but seems blue is also correct.

Spanish parecer is broader than English look and often corresponds to seem.

Because the subject is singular:

• el vestido = the dress

So the verb must also be singular:

• el vestido parece

If the subject were plural, then you would use parecen:

• los vestidos parecen azules = the dresses seem blue

Because azul is the normal adjective form for blue in Spanish.

Many color adjectives do not change for masculine/feminine singular:

• el vestido azul
• la camisa azul

So with singular nouns, it stays azul.

It only changes in the plural:

• el vestido azul
• los vestidos azules

So in your sentence:

• el vestido parece azul

that is exactly right.

In Spanish, most descriptive adjectives usually come after the noun.

So the normal order is:

• el vestido azul = the blue dress

Not usually:

• el azul vestido

In your sentence, azul is not directly attached to the noun anyway. It comes after parece, because it is describing how the dress appears:

• el vestido parece azul = the dress looks blue

So this is not a noun + adjective phrase; it is a subject + verb + complement structure.

Yes. El vestido se ve azul is also possible and often means The dress looks blue.

There is a small nuance:

• parece azul = seems blue / looks blue
• se ve azul = looks blue in a more visual, direct sense

Both are natural, but parece is slightly broader and can sound a bit more like it appears to be blue.

So:

• Con esa luz, el vestido parece azul.
• Con esa luz, el vestido se ve azul.

Both work.

Yes, absolutely.

Both are correct:

• Con esa luz, el vestido parece azul.
• El vestido parece azul con esa luz.

The difference is mainly focus and style.

Starting with Con esa luz puts the lighting condition first, which highlights it:

• Con esa luz, ... = Given that lighting, ...

Putting it at the end sounds a bit more neutral:

• El vestido parece azul con esa luz.

Both are natural.

In Spanish, ese/esa usually refers to something that is not as close to the speaker as este/esta.

Very roughly:

• este/esta = this
• ese/esa = that
• aquel/aquella = that over there / that more distant one

But in real everyday Spanish, especially modern Spanish, these distinctions are often used quite flexibly.

Here, esa luz simply means that light / that lighting. It may refer to a specific lighting situation already understood in the conversation.

Here it most naturally means lighting, not a specific lamp.

So:

• Con esa luz = In that lighting / Under that light

Spanish often uses luz in this broader way to talk about how illumination affects appearance.

So the sentence is really about the visual effect created by the lighting conditions.