If condensation formed on the inside of a tent it wouldn't simply flow down the sides of the tent into gutters. It'd drip, it'd drip all over you and everything in the tent making you wet. Every time you touched the sides or the wind blew, you'd get rained on.
When you're wet your body loses a lot of heat.
Your body would heat the liquid forcing it to evaporate (again, taking the heat with it). This evaporated water would then condense on the tent (again) releasing the heat into the fabric, which in turn would release the heat into the atmosphere. You would quickly become cold and wet and miserable.
This applies to all non permeable fabrics (not just tents), which is why products such as GoreTex are popular. Because permeable fabrics allow the water to leave the garment i.e. the initial heat is lost, but that's it. It does not condense and then evaporate again and again, releasing lot's of heat into the atmosphere and away from your body.
Also, tents are small confined spaces. While your sleeping you will be breathing in all the Oxygen of said tent and breathing out lots of CO2. Now I doubt this is going to be enough to cause you any damage but I would imagine you will become very uncomfortable quickly. This is why, even breathable tents have vents to allow a good flow of air.
Would there be more condensation on the roof of the tent or the floor?
Does it matter? Any water on the floor means your sleeping in water.