xterm-mouse-mode gives incorrect posn-object-x-y with display space

[JD Smith]

The mouse-down events delivered by xterm-mouse-mode do not appear to handle 
clicks on entities with specified space display widths correctly.  Try this in 
a graphical window, and again in the terminal, with xterm-mouse-mode enabled:

(defun my/report-mouse (ev)
  (interactive "e")
  (let* ((posn (event-start ev))
         (rel (posn-object-x-y posn)))
    (message "Got Relative Position %S" rel)))

(insert "\n\n  ----  "
        (propertize " "
                    'extend nil
                    'display '(space :width (48))
                    'keymap '(keymap (down-mouse-1 . my/report-mouse))
                    'font-lock-face 'underline)
        "  ----  ")

Mouse 1 click positions relative to the extended-width space (underlined for 
visibility) are reported correctly in graphical emacs, in screen pixel units.  
With xterm-mouse-mode, however, relative positions are always reported as (0 . 
0) for me, no matter where you click.  Is something wrong with my assumption 
that posn-object-x-y should work similarly in graphical as well as terminal 
emacs with xterm-mouse-mode (modulo the larger “pixel” size)?