Epistatic interactions among genes can give rise to rugged fitness landscapes, in which multiple peaks of high-fitness allele combinations are separated by valleys of low-fitness genotypes. How populations traverse rugged fitness landscapes is a long-standing question in evolutionary biology. Sexual reproduction may affect how a population moves within a rugged fitness landscape. Sex may generate new high-fitness genotypes by recombination, but it may also destroy high-fitness genotypes by shuffling the genes of a fit parent with a genetically distinct mate, creating low-fitness offspring. Either of these opposing aspects of sex require genotypic diversity in the population. Spatially structured populations may harbor more diversity than well-mixed populations, potentially amplifying both positive and negative effects of sex. On the other hand, spatial structure leads to clumping in which mating is more likely to occur between like types, diminishing the effects of recombination. In this study, we use computer simulations to investigate the combined effects of recombination and spatial structure on adaptation in rugged fitness landscapes. We find that spatially restricted mating and offspring dispersal may allow multiple genotypes inhabiting suboptimal peaks to coexist, and recombination at the sutures between the clusters of these genotypes can create genetically novel offspring. Sometimes such an offspring genotype inhabits a new peak on the fitness landscape. In such a case, spatially restricted mating allows this fledgling subpopulation to avoid recombination with distinct genotypes, as mates are more likely to be the same genotype. Such population centers can allow nascent peaks to establish despite recombination. Spatial structure may therefore allow an evolving population to enjoy the creative side of sexual recombination while avoiding its destructive side.