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Here's a few possible solutions to the permissions problem
that retain the idea of defaulting to an install path with
no spaces without making too many assumptions about what
permissions the installing admin actually wants:
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Idea #1

Install by default to %systemroot%\PythonXX. Hey, Java
sticks some stuff in there, right? If the idea is "this is
kind of a part-of-the-OS thing, and MS does it this way for
cscript.exe" then this seems to make sense. (We hope any
admins who're using a %systemroot% with spaces in it know
what they're doing.)

Is the default name for %systemroot% different on any
particular localized versions of Windows? I know it's
"WINDOWS" in Japanese versions, anyway.
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Idea #2

Have two folder select boxes in the installer, one for where
to install Python and one for a folder from which to copy
ACLs. These would default to %systemdrive%\PythonXX and
%programfiles%, respectively. Have a check box to disable
the ACL copying, but have it checked by default.

This is still bad, as it doesn't solve the problem of being
a special separate directory with its own individual ACL to
maintain, but it's somewhat less bad than it is now for
people who click through the installer trusting it to not
open up their system to new flavors of privilege escalation.
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Idea #3

Do something goofy with NTFS junctions.
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Regardless of what's done, given that people expect not to
have to worry about spaces these days, it may be a good idea
to include an explanation/warning about the situation in the
installer text.
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In regards to Martin Löwis' concern about non-admin users
not being able to cause the generation of .pyc files in the
main Python directory tree: It's already like that on most
OS's, correct? So it would just apply in cases where someone
a) writes an add-on specifically targeting the Python
directory tree, specifically for Windows and b) expects .pyc
generation to be done later rather than scripted as part of
the installation. I have no idea if that's common or not,
but it seems relatively safe to break.