Personally I don't think the upgrade is significant enough from the D90 --> D7000... might be better to save more and jump to D610 instead later on 
Using flash is the best way to "improve" low light performance
Some more the D90 has that wireless control of Nikon flashguns, pretty handy 
I've learnt some basics on strobes while I was using my D90 + SB700 

then time to buy f/1.4 or f/1.8 lenses

so what do you shoot that you need to go iso1600?
but u should really buy a flash...remember quality vs quantity of light

you another option, get a FF body

should have change to D700

D7k low light performance is much better than d90. Almost 1stop I'd say. And if u need prime, 35 1.4 siggy is great. 50mm lens too tight for indoor

I think that 1 stop advantage not really worth it eh for the upgrade, rather than spending that money for a usable 1600-3200 iso pictures, I think I'd rather grab a flash at a lesser price and go below those iso settings. then save up for full frame, you'll still yearn for better iso performance even after you upgrade to d7000 i think..

but then also your choice la, I sucks in using flash and even though I have a flash, still despise using them for people shots (hate the outcome), only use them for my macros 

Not sure haha
He seemed very confident to keep his promise 
Haha, I know what you mean mate! Sometimes its a bit embarrassing to bring out a flash to take photos indoors, especially during meals The amount of disapproving looks is really... 

Under very dim conditions, this is what I usually do:
1. Use torchlight to light up the face for easier focusing, lock focus, turn off torchlight, then take photo. The posture of your hands is important so as to avoid shakes. Sometimes I use objects as support so that can take photos even at 1/30 without VR (24-70 F2.8)

2. If you are sitting beside a wall. Use handphone torchlight on the wall, the reflecting light will be less harsh then directly pointing towards the subject.

3. If its really so damn dark and you don't have anything to reflect your torchlight/flash, then you can try artistic shots where only a few regions of the face is exposed i.e. strobes, quite fun After all, you don't always have to properly exposed everything, all the time~

Just some of my noob experiences lol... I'm never very good at portraits, still learning 

Flash requires alot of technique and understanding of light. Personally, playing with flash is alot harder (and costly) than playing with available lighting.

A small tip, you could try the off-camera flash as your D90 has the commander function and fiddle with the power and direction of flash (provided you flash support i-TTL or remote trigger).

I would suggest you could read up on flash technique if you are into flash photography. Sorry I couldn't recommend any site or person as most of my guidelines are of trail and error (also I am still a 'padawan'  ).
Regarding you upgrade options, it would be a personal preference. Some people like the difference between the D90 and D7000, although on paper is otherwise (my friend bought a D90, compared to my D7000 photos, sold his D90 and gotten D7000 and love it). However like others have said, the cost for the differences is minimal at best, and there are much better choice with a little more cost.

You mentioned dinner in your earlier post? As in wedding dinner or normal dining?
I don't think there's really the need to get a flashgun just for shooting in dining areas with dim lights
Can invest in a torchlight with soft light instead, much cheaper and not that embarrassing to use haha 
Seen quite a number of wedding photographers use torchlights instead of flashguns nowadays. Quite understandable since they are much easier to use haha

Well, its just my noob opinion la haha 
I've been playing around with my SB-700 for quite some time already, but I'm still not very good at guesstimations, and many a times the resulting photo will come out pretty bad 

The diffusion will be much better with the umbrella, but that beats the whole point already haha 

@wkwong91 , i'm no sifu, but if you ask me, there's no harm in keeping them Prime Lens

The 50mm f1.8 lens that you are having is it the D lens?

@wkwong i personally find G-type lenses produce better quality photo's (don't really understand the physics behind it) , but just from a cost comparison, there should be a reason why one costs so much more than the other and that reason to me (on top of the AF motor) is the Lens Quality.
(price quote Shashinki)
50mm f1.8D - MYR300+

vs

50mm f1.8G - MYR700+

The 35mm f1.8G is a good lens if that's what you are worried. What are you current lens setup ?

why you want get 35mm? because of f/1.8?   

But you already have the Tammy? 

That's my proposal ring haha 
Most lenses are not that sharp when open widest
Well, perhaps its best that you try it out 1st and see whether you like it or not~ 
Imho, 35mm is a nice focal length for a DX camera, but since you already have a Tammy, its a bit overlapping already 
And most of the time portraits are taken outside too, where the Tammy will work superbly; whereas the 50mm will also give you that extra bokeh when you need it 

Make sure the focus is correct. At widest aperture, the DOF can be very shallow especially if you're at closer focusing distance.
Even when your focus is lock-on, your focus may run if you "moved" or there is back-focus/front-focus issue.
To test, out your camera on tripod and capture. You can compare with Live View Focus result to confirm any back/front focus issue, and don't shoot too close to your subject.

50mm 1.8G is very sharp wide open.

1. Off focus- Not enough light to focus correctly.
2. Hand shake - Shuttle speed is too slow.

Don't blame the lens if cannot get sharp images, you need to improve your skill 1st.