The nbsp named entity was used as it was commonly known and consistent, and, well, it didn't seem to be an issue.
If in the code we change conversion of the character to the numeric entity instead of nbsp named entity when loading the file then we also need to change the code that converts the character to the nbsp entity when you switch back from Book View (otherwise you'll just get an error if you have no DOCTYPE defined). This should work.
But now anyone who was using a DOCTYPE and nbsp entities could have some of those nbsp entities turned into numeric entities (e.g. on pages they edit in Book View) leaving a mix of named and numeric entities. Alternatively we change all nbsp entities into their numeric form everywhere in the code (loading, empty paragraphs, insert special character, etc.). That might affect quite a few find&replace statements and quite a few people so if such a change were made it would probably wait until a major release.