Space between left palm & neck

I know this is taught as a standard in classical style but does anyone know if this is also adopted by any of the Jazz greats?

Not sure if many jazz players have adopted that as part of their technique...but personally...I don't think its a hinderance to ones playing style. In fact I believe it's essential for a good reach on the fretboard...as opposed to hooking ur thumb over the top. I would defintely recommend centering ur thumb on the center of the back of the neck...no matter what style u play.

It's good to learn both ways - each have their uses....

I wouldn't be able to bend much past a tone and a half without moving my thumb away from centre. My most over the top vibrato also wouldn't work in 'classical' position, I'd just end up with the guitar coming out of my hand, and the vibrato replaced with string noise.... :)

I think the trick is to keep your hand positioned solidly but be able to adjust it one way or another for whatever you're doing. I'm sure in plenty of songs there are times when gripping the neck close will be better, while in other parts a classical grip will be the most beneficial.

I'm still working on this myself, my wrist gets locked in one position and it's hard to get it to feel lose again.

The benefits of the classical approach is that you get a greater reach plus
if you have your palm glued to the neck it's easy to accidentally mute strings
when you move your fingers on the fretboard.

If you've got High Bandwidth Access, there's a video here on the subject showing different examples.