Change your template back to Sheet1 (no space).
As for your custom property issue, In the Sheet Properties dialog, under "Use custom property values from model shown in:", select the view that contains the model you want to take the custom properties from.
Your question is why is this happening, not sure but it could be your drawing format settings. Attached is an awesome macro written by Leon Wurr that I run with every drawing file. In my multiple sheet drawings I have Cover Sheets with our ECN info plus a few other sheets and this macro renames the sheets correctly, any tab that has the word "COVER" the macro skips across them and starts at the first page of the multiple sheets.
CustomSheetNumber.swp.zip 18.5 KB
Something that I have noticed with Solidworks.
This has to do with Sketches, extrudes, sheets on drawings, etc...
Whenever you create your first feature/sheet/sketch, it will name it "....1".
When you create your 2nd one, the program will scan through your document and, if it finds a "...1", then will create a "...2". If it finds a "...2" then it will create a "...3", etc...
If you rename that first feature/sketch/sheet before you create your second one, then when you create your second one, it will scan through the document and it won't find "...1". So it will name it "...1".
So, it looks like someone renamed "sheet1" to be "Sheet 1", then saved it as a drawing template. Which means that when you create a 2nd sheet, it scans though the document and can't find "sheet1" so it names the new sheet "sheet1".