What I mean is not "physical room for people," it's "exploited versus un-exploited resources." It's not as if we're running out of room for farming -- and even if we were, it's not as if we're managing the oceans in anything that vaguely resembles a serious, competent fashion. Earth is much larger than we tend to think, and much more empty (remember how if the population of the Netherlands lived at New York density, everyone in the country would fit in the "dongle" of southern Limburg that borders on Belgium). In other words, we can afford to worry about more urgent things -- torture, for example. (Not just American; how about the Uzbek dictator who boils prisoners alive, or of course the Chinese?)

Additionally, there may be a difference in my values relative to yours: I believe that people are intrinsically valuable, and that therefore it is better to have more people in the world than fewer people in the world, all other things being equal.