Unfortunately, both functions are affecting both of my outputs. I leave it on "space" and it works fine. With the Headphone option on, it's popping like everyone else's.
OS 3.2.1 - the same for me on high gain amps. I play only on HEADPHONE output now. When I engage "Headphones space" in OUTPUT when playing palm muted notes I can hear high frequency cracking (gentle one..) - it's gone after I disengage "Headphones space" in OUTPUT.
IIRC ticking the headphone space box turns it off on the main outs
Kind of weird logic 
"Headphone space" and the box is not ckeced(ticked) "Space" and the box is ckeced(ticked) - like you can set "Headphone space" but it is disabled (unchecked) so it's not working, when you press soft button it is enabled but it becomes "Space". Just noticed that for first time and I was confused at the beginning 
Ticked is with it on the headphones and unticked is on the main outs?? Yep is that right don't use it on my studio KPA and leave it on the main outs only on my Live KPA
Replied in the other thread but I reply here also, to get noticed the issue and earn + 1 post 
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So I just did an experiment and for sure Space effect that can be put in STOMPS and X, MOD slots does not sound the same on headphones as setting "Headphone Space" option in OUTPUT menu.
I
have set "Space" effect to 5.0 in slot X and the sound was rich on
headphones, while "Headphone Space" set to 5.0 barely changes anything,
and it crackles lightly.
When I set "Headphone Space" to 10.0 it
crackles hardly even on clean rig, while "Space" effect set to 10.0 is
even more spatial and still clean.
That makes me wondering that "Headphone Space" is not "Space" effect or it uses different scaling...
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