dnd 5e – How does the Dimensional Loop’s Fold Space ability interact with areas of effect?

Rules as written, I’d say no to your first question, and no to your second. As you quote from the ability (emphasis mine):

You treat that space as if it were within 5 feet of you until the end of your turn.

In all spells and magic item effects, “you” refers to the caster of the spell or user of the item. So Jim treats the opposing wizard’s space as if it were within 5 feet of him, but the wizard casting fireball – and indeed the resulting fireball itself – does not.

In the inverse case, if Jim casts fireball on his turn and targets the opposing wizard’s space, he is still safe. Jim treats treat the space as if it is within 5 feet of him, but the space does not do the reverse – the wording of the spell means the effect only goes one way. The wizard in the opposing space cannot reach through and attack Jim, because the space does not also treat Jim as if Jim were 5 feet away.