The Koldunov Brothers put together this simple demonstration of how using a standard white party balloon can give your flash photography a nice diffused look.
The real difference is that this increases the size of the light source in the same way as a cumbersome soft box, but it packs easily into a camera bag or your pocket. The real difference will be the reduction in hard shadows on walls behind the subject.
FYI here's another good one:
• Simple diffuser for pop-up flash in portrait photography (YouTube / Koldunov Brothers)