Can an infected hip joint space cause a hip to dislocate??

Answer 1

Yes, it would but not directly. The infection would create muscle degeneration, infection (we already assumed that) and further bone deterioration. The hip under duress could possibly dislocate.
If this was the case, the hip would have to have an artificial piece put it to replace the bone.

Answer 2

If the infection is strong enough or lasts long enough to cause the bone to either be eaten or wore down, yes a dislocation can happen. However, the infection itself does not cause the disclocation but the effects of the infection on the bone and muscle.