In the end, it seems it's good enough. Both high speed trains as well as the heaviest freight trains ever work fine with standard gauge.
That was key reason. The other was that 7ft gauge limits how tight your corners can be versus standard gauge. There are other minor disadvantages, such as that because trains are bigger, tunnels need to be wider.
The 7ft gauge trains were probably a lot more smooth though. And that extra ~3ft would make them feel much more spacious. Luxury was a big prestige element on the Great Western.
There's an interesting chapter in the memoirs of Charles Babbage (he of the Difference and Analytical Engines) where he describes his experiences with the first railways and how he did some experiments on Brunel's Great Western route and built (one of, or possible the?) first dynamometer cars:
https://en.wikisource.org/wiki/Passages_from_the_Life_of_a_P...
That chapter also contains this priceless bit where after Babbage had only by luck narrowly avoided a head-on collision with Brunel going the other way on the same track, Brunel replies that if Babbage's train had actually been approaching the other way on the same line, "he should have put on all the steam he could command, with a view of driving off the opposite engine by the superior velocity of his own."