You have a lighting problem. Your "environment" has no lighting so it cannot show you anything, including shadows.
This is a rendering setting, and all you need to do is enter the rendering setup and pick a different room or lighting setup.
I underlined the setting to give you a "studio" feel:
I tried going through a few different settings. Here are a few screenshots. All have the 'Shading with reflection' settings:
1. Here, I tried to apply different textures to the room. But the room appears grey regardless.
2. Here I tried changing the room to one of those in the library. No use.
3. This is what I see in the lights menu:
The blackness seems to be a rather all-pervading thing.
You must have a lightbulb out 
What happens when you open a new part, empty, using the default environment after you restart Creo?
I don't like the Scene interface at all. I have accidentally ruined perfectly good scenes just like you have by trying to tweak just one little thing.
What seems to be missing is the ambient light and the primary directional light. Those pointers in the last image should look like light shells... and not black. That is why I am thinking it is ambient.
You also have to make sure the object is within the "room". It is possible to go below the floor or behind walls. This doesn't help either.
How many engineers/Pro designers does it take to change a light bulb?
Thanks for the laugh today!
Ah, the lightbulbs! Now, why didn't I think to check those? 
Thanks for your responses . A little more background. Hope this sheds some more light (started making bad puns, I'm desperate for illumination here!):
1. I have just started using this machine a couple of days back. I do not have administrator acess but I know the person who has root access to the system. It's previous user is no longer on campus so couldn't test the settings using his account. But I shall try to do so.
2. The settings (lighting, material color, texture, everything) are all set to default as far as I know. Or rather, the default settings of the previous user.
3. I am unable to change the object's default color. I have tried going to Options>System Colors>Graphics to change the geometry color. But though the menu says that I have done so, the part still remains black. I, however, can change the edge colors in-session but they again reset to black when I restart Creo. Please do note that I can still paint the surfaces with different colors, but again, it still doesn't look very good.
4. An interesting thing. When I set the rooms as seen in screenshot 2 in my previous post, I could see the room being reflected off the part though the room itself was nowhere to be seen.
I will try fiddling with the lighting settings when I get back in the lab today. Is there anything else that I should try? And going with what Antonius suggested, is there a way to find out if there is some user defined settings thats overriding the render settings?
Antonius Dirriwachter wrote:
Render environment setting are saved to the file. I am wondering if the default part files (templates) were somehow over-written with poor render settings.
And also, the user has an educational license. Full versions cannot open these files. FYI.
I mis-spoke in this reply. You have to specifically select saving the scene with the part file. Sorry for the confusion. See the dialog check box in the this image: "Save scene with model"
I apologoze for taking a few days to get back to this discussion. And thank you, Antonius, for all your help. I'm sure that what you had suggested would have worked had I had save/modify permissions on my computer. It seems most likely that there was an errant config file somewhere that was somehow being used as the default by Creo. No matter whaterever settings I tried changing, it would always reset upon restart.
I am working on a different workstation now (the person with admin access on the other one is away) and all is good! Thank you once again, Antonius. I shall mark your suggestion as a helpful answer instead of a correct answer as I have not yet been able to test if that is indeed the right solution.
