If user writes:

<dfdl:property name="textNumberPadCharacter"> </dfdl:property>

That's not a legitimate way to create a string containing a space in XML.

Now, we're not going to do the right thing currently if the user writes:

<dfdl:property name="textNumberPadCharacter" xml:space="preserve"> </dfdl:property>

why? we don't even check for the xml:space attribute. All-whitespace nodes are trimmed away explicitly, by Daffodil code.

At least in theory, things that pretty print and or re-indent XML documents should not mess with all-whitespace nodes if xml:space='preserve' is in a surrounding element.

The workaround is simple. Use CDATA region.

The user has to do this:

<dfdl:property name="textNumberPadCharacter"><![CDATA[ ]]></dfdl:property>

so as to insist that the content is not fungible XML whitespace.