The band was actually made up of some friends of mine. Every guy in the band had been to the studio before at one time or another. They actually sounded good and played well. (This is a fairly rare thing in my neck of the woods).

The band was not earth shatteringly loud. They weren't knocking people over with volume or anything like that. Normally, I'd consider their volume to be about right in the bar they were in.

The only problem was I didn't come to the bar by myself. (I don't think I've ever been to a bar by myself). I came with 5 or 6 friends. Because I was “Brandon in hang out with friends mode” and not “Brandon in music mode” or “Brandon in live sound man mode” I had a TOTALLY unique perspective.

Knock That Volume Down
I have no doubt that if the volume would have been several notches lower where I could still actually communicate without sign language, we would have stayed at the bar. Basically, the band, who I would have gladly stayed for, had created an environment where we were not able to do what we set out to do....socialize.

Is The “Product” Broken?
Most bands probably don't look at it this way, but if people want to communicate or socialize and your band is too loud, the “product” is broken. If the aim is to have a conversation, trying to talk in a loud bar is no different than trying to talk on a cell phone with no service.

Think About Your Real Fans
Of course, I'm not necessarily saying that a band SHOULD turn down. I'm not saying that at all. I'm just bringing up the point that you are going to be alienating a certain percentage of the population with a show that is too loud for people to hang out and have fun in.

It's totally possible that your real fans would be disappointed by a quiet show. Then again, I've done a little testing on this myself and the crowd seemed to be dancing either way.

Technical Considerations
Of course, from a live sound standpoint, if the PA is turned down, the sound from the stage is relatively louder. In most cases, this means the natural sound of the drums is going to be more prominent. In some genres, this is considered to be a bad thing.

With a real drum kit, there is a bare minimum level the band can go. In small rooms, it's going to be loud. That's just the way it is.

Conclusion
Just be aware that you could be alienating “would be” fans by playing so loud that people can't even communicate. Then again, I'm just an audio recording guy.