If you are on the latest iOS 5.0.1, you do not need to have you shsh save since that's the version of iOS in your iPhone and that's the latest one too. By the time a new version of iOS will be available and the 5.0.1 will become an old one then you need your shsh in order to restore the version 5.0.1 and jailbreak it. Most of the time cydia will automatically save your iOS version for you so you should be out of troubles. Open up your cydia and on the first page of cydia on top of the WELCOME TO CYDIA message check if you see this mention there or not "SHSH: iOS 5.01, 5.0.1r1" if yes then you will be able to restore the version 5.0.1 after a new iOS version 5.1 will be out.
Now for you issue at the moment and if you are on iOS 5.0.1 you will lose your jailbreak if you restore it, but you can jailbreak it again and reinstall all your tweaks/apps on it. You have to know remember most of you important tweaks/apps to be able to reinstall them.
The stuff with "Other space" is that if you perform a backup of your iPhone with iTunes, then factory restore the iPhone and restore your backup file, the "Other spaces" will again be the exact same as it was before you factory restore your iPhone. The only way to clear up the "Other space" is to start everything from scratch. But you can always try to restore you backup and see how it goes, if the other space is still up, then you will know that you need to start everything from scratch. Good luck.
