From version 3.2 onwards, holding down the space bar causes a temporary switch to the Push tool. Releasing the Space bar returns to the previously selected tool or pressing it once will switch to the push tool and pressing it again will return to the previous tool.

You can restore the old use of the space bar as a shortcut to the Selector tool.

Xara Xtreme 3.2

Download copyhotkeysini.zip
Extract the contents of the zip file
Double click the copyHotkkeysIni.bat

Xara Xtreme Pro 3.2

Start the Xtreme Pro Shortcuts utility
Select Tools from the left side
Select the 'Switch to Selector'(default shortcut of Alt+S) and choose 'Space' from the keystroke list.