Displaying spaces in titles is an admission of sorts that spaces in links would be nice too, so this is an argument for FreeLinks.
Sometimes spaces will be inserted in the wrong place, such as for ErikDeBill, which should really be displayed as Erik DeBill, not Erik De Bill.
SpacesInTitles might confuse newcomers and thus discourage editing. They also prevent users from copying a title into a page's text and get a link. On the other hand, they raise wiki pages' search engine profiles, because people don't search for WikiNames. Compare  and .
On my [site], I started breaking up StudlyCaps? because the sidebar boxes were expanding, and BigLongUnbrokenStrings don't get broken, so the boxes expanded beyond the size I wanted. I don't care if this ever shows up as an option for page titles, but if we hack in direct RSS support, this is a problem that we'll have to deal with.