I didn't mean literally "black". I just meant very much darker. I was emphasising for effect - it's a little hard to get the light hearted element across in a written internet post.
Here's another example. Note the difference between the way the room looks in my photo compared to yours. I have the light balanced across the room and the people are evenly lit whether close to the camera (I was using on camera flash) or further away. This was at my default 1/60, f/2.8, 1600. Apart from a tweak to the tint this is unedited.
By the way, this was taken with a 50D. Even at 1600 ISO it hardly suffers badly from noise.
Apart from brightening the room, the more ambient light you pull in the less work your flash needs to do. You see less in the way of flash shadow and less obvious falloff in the light from the flash as it spread further away. Of course, bouncing the flash helps even things out, but with low ceilings or large rooms (or no ceiling at all!) you may struggle to get the flash to cope on its own.