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From the OpenSpace V2 Docs...

CLICK
public static const CLICK:String = "avClick"
(read)

Dispatched when an avatar (main sprite only) is clicked.
This event is fired if the <EnableAvatarMouseEvents> parameter in the OpenSpace client-side configuration is set to 1 only.

What is considered the main sprite? I have a game were we are dynamically creating the avatar using a 3d rending API. I've tried implementing the avatarclick event, but it doesn't seem to dispatch. Is the "main sprite" referring to a movieclip or graphic that has to be in the avatar initially?

"main sprite" refers to the fact that you can have a ghost avatar too. Check the documentation for more informations on this.
Not sure why that doesn't work.. maybe it is related to how the sprite is generated by the 3D framework.