When converting EPUB to EPUB with Calibre, the presence of a non-breaking space [ ] in a given file causes the CSS file path in the <head> of that document to point to the wrong place.
I just can't quite get my head around that. Are you saying there's an nbsp entity in
the path to the css file in the <link> tag in the head? That's not valid to begin with ... and I frankly can't think of another nbsp entity situation that would cause the file path to be wrong.
As to the "entity 'nbsp' not found" error (and nothing working until all occurrences are removed) that sounds like an incorrect namespace in the document header.