Is there no gravity on the space station?

The larger the object, the more 'space' is displaced, and thus, the greater the gravity. The Moon displaces less 'space' than the Earth, so the Moon has less gravity. The space station displaces very little space AND its' shape does not lend itself to taking advantage of the spacial displacement, so it doesn't result in very much gravity.

Stand in a swimming pool and hold a beach ball under the water: the pressure of the water on the ball is a simulation of gravity. Hold a tennis ball under the water: far less pressure, yes? Now, hold something with the exact same collective mass as the beach ball (lets say one of those 'noodle' things the kids play with) and you'll have far less pressure on it than on the beach ball. Why? It has the same mass as the beach ball, so why isn't there the same amount of pressure (gravity) on it? Because the 'shape' of it does not lend itself to take advantage of the gravitational pressure.

Gravity can, however, be simulated with inertia. If the ship spins... centripical force and all that.