When attached to Cmd, Windows Console (the terminal UX) intercepts many keys / chords to, for example, display its system menu if you hit ALT + SPACE.
However, when connected to WSL, Console intercepts almost no key chords at all because in the Linux world, Terminals traditionally do no work - all key strokes/chords are passed to the application (e.g. bash) for the app to decide what to do with.
If Console was to intercept ALT + SPACE to display the system menu, then Linux applications that require the user to use ALT + SPACE for some operation or other would fail to work, and there would be much gnashing of teeth. For example, when running emacs in Hyper which appears to be intercepting ALT + SPACE
HOWEVER, all is not lost. We are keen to figure-out a way to better handle keyboard mapping for a future release of Console. But this is a pretty large work item that's a little way down our backlog at present, so please be patient with us ;)
Alas, because Console's primary role is backward compatibility, we cannot add ALT + SPACE support to Console.
However, we do encourage you to download and use our new Windows Terminal which offers far more configuration options, including the ability to map many key chords, as well as better control colors, styling, background blur/transparency, etc.: https://github.com/microsoft/terminal
Please watch this playlist to see the Terminal's "sizzle video" and our deep-dive session from Build.