Hey, thanks for playing!
There's no real consequence for staying in the dark - I didn't think killing the player and forcing a replay was going to be fun in this short of a game, after all how many times can you dig through the same pile of mud?
The rock lifts the gate in that room :). It's initially closed, might've missed it in the dark.
There are two upgrades - one for speed and one for digging radius. They both aren't on the main path, but aren't very hidden either. A red glow gives them away.