The whole French/Portuguese/British occupation of Spain is completly farfetched, especially set in a quasi-realistic nes (which this was.) If you forget about the fact that the United Kingdom (if it was in its right mind) would never have let the Germans/French invade, if you forget the fact that you simply can't do away with a modern country, and if you forget the fact that common sense just screams "NO!" at the scenario, maybe then you can bring peace to your mind.
Seriously? In the first place, do you honestly think people would have been stupid enough to allow GERMANY to rearm enough to fight an offensive war? And you seemingly forget the fact that all the countries mentioned are not only members of the UN (which would undoubtly interfered in any invasion of a European country), but also members of NATO.
*sigh*. The majority, as seemingly forgetten, is never the whole. It's extremely convient, after all, that the rest of the world would sit back while a nation is not only made war against, but annexed completely by foreign aggressors. Honestly, the majority of the EU, Un, and NATO would have came o8ut against your blatant aggression as what it was- aggression. Had you no wants of your own, Spain would still exist- as an independent country. Finally, Portugal? Are you serious? Portugal would never be able to be in control of the areas it is unless it has massive help keeping the rebellions down.
Since the fact that the U.N was designed to prevent foolish ideals such as this. Honestly, a riot would have occured if the UK invaded Spain, and very likely, the U.N would have broken up over the war. Russia ,not mentioning the U.S (or its successor in the Big Five), would have knocked out any resolution to invade Spain, UK and France would likely knock out any restrictions placed upon theirselves.
The point I made earlier. This isn't the 20th century either. Cultures are uniue these days, people clamor for indepence on ridicioulus levels and are quite willing to fight for it. I mean, look at the Balkans. If all those groups are willing to fight for their independence, the Spanish (a culture larger than the Balkans combined) is willing to bend over and die out? The amount of insurgencies within the French/British/Portuguese Spain would be a such ridicioulus levels that holding those regions wouldn't be worth it. If anything, they'd invade, knock the gov't out, and then place a puppet in power.