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I am also having issues here. The quick entry window wouldn't let me assign CMD-Space (said it was in use) on my iMac, even though I have that assigned on a Macbook Pro with the exact same applications preferences (I know this because I used migration assistant to set up my iMac three days ago). I actually fixed that by editing my plist file, so that works now.

I tried using CMD-OPT-Space for clipping, and again, it works on the Macbook Pro, but will not let me assign it on the iMac. I tried to change it manually in the services preferences, and it will let me set it there (which coincidentally changes the Omnifocus prefs to show CMD-OPT-E, which doesn't work either), but it still won't work. If I use the mouse, the services menu works just fine, but the keyboard shortcut doesn't do anything. Also, the services menu doesn't show a space in the keyboard shortcut area, it just has the symbols for command and option.

Is there an inherent problem with using space in the shortcut? If so, why does it work on my Macbook Pro? Is there a plist file I can just edit somewhere to bypass that god-awful shortcut recorder widget?