Are there any pitfalls for putting space in GameObject/Prefab names?

I don't think spaces in a gameObject name can cause a real problem, but no-spaces is probably simpler. Transform redBall = balls.Find("red ball"); is harder to remember. Easier if everything is camel-cased. Plus a very minor problem of confusing 2 spaces with 1 -- "red ball" (2 spaces after red, by accident).

Historically, spaces in filenames caused problems when you used them on the command-line. (Unix didn't allow them, but Microsoft foolishly did). Some strings also turn into variables, so can't have spaces. For example, Unity allows you to name a script "red ball", but then the class becomes "red ball", with a space, which breaks it (public class red ball {).

Because of stuff like that, most people probably instinctively avoid spaces in names that users won't see.