The reason Mesh Space must be selected instead of Local Space is because Mesh Space applies its additive effect in the space of the Skeletal Mesh Component. This causes rotations to move in the same direction, regardless of the orientation of the preceding Bone in the Skeletal Mesh. This is important for Aim Offsets because in some cases, you may want the rotations coming from the Blend Space to be applied consistently, regardless of the current base pose of the character.