The OP definitely has a point, and there are other people having this problem as well.
For me, Normal on HDMI Black Level looks pretty bad, as the OP is saying. As far as I can tell, I always have the option between Normal/Low when using HDMI. Low was default for me, and it looks far better. Normal looks very washed out, no blacks, etc. Others seem to have a problem of not being able to select "Low" So finding a solution to that or a good reason would be nice.