What is this white 'No items selected' popup box in save/open dialogs?

On a Mac running Lion, in the Save As dialog boxes for seemingly all applications, there's a white popup box that appears and disappears on pressing the space bar. I notice it a lot as I use a graphics tablet with one of the pen buttons set to pan / scroll the page, which in adobe creative suite applications on a Mac, maps to the space bar everywhere in the application including OS dialogs - so I often trigger it by accident when trying to scroll through directories when saving files.

Here's an image of it:

It took a while to figure out it was the space bar that was bringing it up (since I wasn't ever actually pressing the space bar...). Its close 'x' button seems not to work, so until I figured out (just now, actually) that it was the space bar that toggled it, I couldn't get rid of it most times it unexpectedly popped up. Dragging files into it doesn't seem to do anything, which discounts my theory that it's some kind of collector for overwriting multiple files at once. Nor does clicking on files or folders to select them. What is it and what is it for?

I figured out the answer while confirming a few behaviours of the mystery white box while writing the question. I'm posting and answering the question anyway since none of my searches turned up anything.

So it seems it's the File Preview box: if you hit space in the 'Open Files' dialog with a file selected, a similar box gives you an enlarged preview of whatever file is selected.

In the 'Save As' dialog, however, you can't select files (clicking just copies the file name), so it will always come up as 'No items selected' any time it comes up. While you can select folders in the Save As dialog, it doesn't attempt to preview them and continues simply saying that nothing is selected.

Here's a screen grab of it functioning by previewing the screen grab of itself not functioning:

Seems like it can never show anything other than 'No items selected' in the Save As dialog.