I can't say that Space Jam featured prominently in my childhood. Probably because I was in my teens before it came out.
Yeah, I didn't know anyone looked back on Space Jam as some treasured film. I saw it when it came out (I was 14), and shortly thereafter it disappeared from my consciousness. I can't think of a single memorable moment, unlike say, its contemporaries Lion King or Toy Story. I have fonder memories of that era's Michael Jordan Gatorade and Nike commercials.
Plus, it was a blatant marketing money-grab with little artistic merit. So making a sequel isn't really spoiling its good name.