There are some definite advantages to fast glass:
1: Autofocus is noticeablt faster and more precise in dim light, because AF is done with the lens wide open regardless of the exposure aperture.
2: The viewfinder is brighter.
3: You don't need to crank the ISO setting up as high, which means less noise in your images, or the ability to shoot in places you couldn't otherwise. In dimmer venues, you simply can't shoot with anything smaller than f/2.8.
4: Narrower DOF, which can be an advantage or a disadvantage depending on the shot. It's great if you are trying to isolate a single subject from background clutter, but not so great when trying to get multiple individuals in focus simultaneously.
As said previously, IS is great for reducing camera shake, mirror slap, and tripod vibrations, but does not affect motion blur from a moving subject. Only faster glass and/or increasing ISO will get you fast enough shutter speeds in dim lighting. I have the Canon 70-200/2.8L IS, and it's one of my favorite lenses. It's optically excellent, and I use it for portraits, events, and stitched panoramas.