Sometimes you don't want to use a flash and 1/60 sec might just be fast enough...
I'd agree that most compacts are pretty useless at high ISO levels but the best of the bunch do a reasonable job. I have acceptable shots from my LX5 at ISO 3200 1/60 second. Doubtless these shots wont stand up to a heavy crop and close scrutiny but as whole image shots at a reasonable size they are ok and if you have heroic processing skills ISO 12,800 is available.
If willing to move up a bit more in size as well as cost a GF1 or similar will provide better results.