This world is based on one of the first Disney shorts, Steamboat Willie, which featured Mickey Mouse. In Kingdom Hearts 2, it is the "other side" of Disney Castle and is apparently where light was first discovered. As you have seen yourself in screenshots, the world will be accessed through the Altar of Light in the Disney Castle.

The world starts off with Pete smiling and then bursting into evil laughter. As Sora and company enter the world, they notice that they've all changed into monochrome versions of themselves as well as the environment surrounding them.

While Pete begins to taunt Sora, Donald and Goofy, it seems the gang has fallen right into Pete's trap, but sooner or later, it all starts catching back up to Pete. While Mickey is in this world, it does not seem to be the King Mickey we have seen before. The role of this world marks a huge point in the storyline.