https://github.com/zkoss/zkspreadsheet/blob/10656553b78b5785b84f04b6c6cdbbdfb1c3a01e/zssmodel/src/org/zkoss/zss/model/util/RichTextHelper.java#L207

white space (' ') in cells are replaced by nbsp in zss 3.8.0+
Cause the whole string to be considered as a single word when wrapping text.

css property white-space: pre-wrap; might be used instead to keep both the wrapping and to display white spaces in browser.

attached example:
1 - in index.zul, change src="/WEB-INF/resources/2223/blank.xlsx" to refer to blank.xsls.
2 - run zul file
3 - click on the wrap button to add text/wrapping