This is a feature request, not a bug.
I'm using this editor. I put my cursor next to a NBSP HTML entity. The presence or absence of a toolbar should not matter.
Currently, entering a non-breaking space using HTML code makes the text harder to read in the editor window, as the HTML entity breaks the flow of reading naturally in a way that non-alphanumeric characters such as wikilink brackets don't. You can also enter it as an actual non-breaking space, which doesn't disrupt flow, but it looks no different from a regular space, and future editors won't be able to tell the difference.
What if actual non-breaking spaces were given a light gray outline in the editor window, maybe with the letters NB inside on English projects, to distinguish them from normal spaces, and people would switch from using the HTML code to actually entering it as is? It also improves on page size; I believe the HTML entity uses 6 bytes, while the actual character uses only 2 in UTF-8.