No matter what i do with the ISO my pictures blur in low light or get very dark?

I have a Nikon d5100 and I just don't know what to do. Today we went to a place with Xmas lights, I wanted to take some pics of my son and even with an H1 the pics were blurring. All of them, had to take them all on flash which takes from the effect. I try to shoot in manual and even when i my ISO is at it's highest the pics are dark. This is so frustrating! My sony tx1 point n shoot can take better pics indoors or in low light but my DSLR is making me cry. Can some one tell me what is it that i can do to fix this problem? I want to be able to take more pictures without the flash. When i up the exposure the pictures blur, ISO doesn't make too much of a difference. I know there's something that i'm missing obviously but what? Any help will be appreciated.

ISO is only one part of the exposure 'triangle'. You also (if in manual mode) need to learn to balance your exposure with shutter speed, aperture, and ISO. Only changing one will not get you the results you want. If you're in auto mode, and don't want flash, turn your mode dial to the "no flash" symbol.It'll do everything for you, but might not expose the way you want it to. Just learn to balance your exposure and you'll be all set.

One of your problems is the slow 18-55mm f3.5-5.6 zoom lens you're trying to use. Another problem you have is not understanding the Exposure Triangle which consists of Aperture, ISO and Shutter Speed. This will help you learn about the Exposure Triangle:
http://www.digital-photography-school.com/learning-exposure-in-digital-photography

A fast prime lens like the Nikon AF-S 35mm f1.8G or AF-S 50mm f1.8G will also help you in low-light situations.

Look at the Scene 'Domestic interiors at night, subject lit by campfire or bonfire' at this site:
http://www.calculator.org/...osure.aspx

At ISO 3200 an f1.8 lens will give you a shutter speed of approximately 1/170 sec.while your 18-55mm zoom at 18mm and f3.5 will give you a shutter speed of approximately 1/80 sec. And at 55mm and f5.6 your shutter speed will be 1/30 sec. At 1/80 sec. And 1/30 sec.blur caused by subject movement will be apparent.

For tips on shooting Christmas lights go here:
http://strobist.blogspot.com/2006/12/how-to-photograph-christmas-lights.html

Photography requires study and learning if you want good results.

You have good answers above, but even when you get the exposure right, you may need some fill flash for your son. The main light is behind him, right? This will leave him in a shadow. You can use your pop-up, but dial it down with some negative FLASH compensation. (see you owner's manual)

Here is a snap that is as you describe and I have all of exposure information right there. You can see that I used (-2.0) flash exposure compensation. You can also see that I used f/7.1, so your lens should not be a problem.

This is where you have gone beyond what any auto camera can handle. You need to take control.
That is why you have a DSLR - so that YOU are in control.
Ignore the meter - it is trying to render the scene an average midgrey - hence the long exposure.

Camera on M mode
ISO200
Use flash (to illuminate your son) - set your flash to under expose by 1 stop (maybe 2 - try both)
1/60th sec (maybe 1/100th - try both)
take several shots at different F stops until you get the effect you want.

In low light you may need a good tripod because some of the blur is probsbly from the slow shutter speeds needed. And practice a lot to develop your skills and photo graphic "eye" for lighting and composition.

Fool around with this for a while.

http://camerasim.com/camera-simulator/

I found it very useful when I first purchased my camera. It helped me see exactly what each setting does.