Hey Paul, I am no expert in this area... it is almost philosophy.

But I think space need not be a "thing" in the traditional sense of a physical object, in order for us to use it. Just like one can use the number 7 without it existing as a physical thing.

In that sense space is a way of organizing physical things w/o itself being a physical thing.

in the same way that if I say that it is 7 o'clock I am organizing time points, but that does not make 7 a kind of time. it is just a way of organizing time.

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and to answer the question about measuring space. I think the physics guys use time, and light as a way to measure space, though I think there are a number of physical processes that yield measures of space.

Still I think these measures tend to be circular, such that "at the bottom" there is nothing that does not somehow depend upon another thing. So it would be possible to "shrink" space by a factor of two, and slow time by a factor of two, and we would not know the difference, since we have nothing to compare to. (I know this is true for light, and I THINK it is true for other interactions, but I am not positive.)

still back to your original question. If you expanded your chess board of nickels, you could see it was expanded since the time it takes light to travel between nickels is now larger. it is in that sense that we can talk about space expanding.... distances increase between two objects w/o any acceleration experienced by either object.

but as I say.... I am not an expert. ;-)