I think this is really good for what it is. I would make the torches emit light that strikes the wall around it ( if thats to be done in game, perhaps show a quick mock up of the effect?). If you want to keep things classical, I don't think theres a need to push things farther; However, multiple tiles to break up the monotony of the floor and the introduction of 45 degree walls is a possibility.
The pixel technique in all of this is delightful.