First, MySpace was incredibly clunky. When you posted an update the entire page refreshed. Facebook had a much sleeker interface that used Ajax so posting updates was much more seamless.
Second, I think the mid 2000s were a unique time where consumers were very willing, almost wanting to try different sites and technologies. I remember these being the days Tumblr took off as well. Now people seem to like simplicity and speed, and are content focused. At that time it was all new so people like customizing pages and having custom songs play when the pages loaded.
Finally, Facebook had integration with third party apps that made using the site more fun and gave people a built in feature to share. I remember living social not as a deal site but a Facebook app where you ranked your five top things from a bunch of categories, such as top five movies, books, etc. Users loved it.
These factors are easy to forget now where they don’t seem that big a deal but at that time these were huge differentiating factors that made Facebook more popular and I think Facebook’s early product teams probably don’t get enough credit for some of these decisions.