I just got a K20D too, and I'm been experimenting with the built-in flash. For now, it's the only flash I have. Altough I prefer not to use it, I understand tht there are times when some flash is nneded.
If the ceilings are white and not over 10 ft, a pieced of curved/folded white paper can be held in front of the flash to bounce it off the ceiling. The effect is much nicer than direct flash. You may need to dial up the flash compensation a notch.
Where the ceiling is too high, I have used a homemade diffuser that I originally used on my point & shoot camera's pop-up flash. It seems to operate much like it did on my P&S camera. It will reduce the light from the flash somewhat and disfuse it. I've also gotten good results by dialing up the flash compensation a notch with this homemade doohickey. It's best to expeirment before hand.
It's just the side of a plastic mik carton (cut and folded), some velcro, and a folded piece of scrap photo paper at the back to help bounce back some of the light.