How to use the flash?

I haven't had much chance to use the flash (the standard one), but now that I got a chance it seems to behave oddly. It appears the exposure values are completely independent of use of flash. I took a picture of a dark scene. In iAuto the camera chose 0.5s and ISO 1000 -- same as it would without flash! In P mode it chose 1/60 s [which I believe is normal for flash], but ISO 1600. I manually chose ISO 400, and that also seems to give a reasonably exposed picture, although in some cases it gave an underexpose picture.

It SEEMS to me that the camera chooses wrong values for shutter speed and ISO when using the flash, in particular in iAuto [which otherwise should be the non-thinking P&S mode]. Or can anyone explain the rationale?