Ya, it really depends on how you like to travel, and what you want to see. We were there last year. In 16 days we did Barcelona, Mont Surat, Granada(the Alhambra and hiked second tallest peak in Spain), Seville, Lagos Portugal (awesome beaches), and Lisbon. 3 days was enough or us in Barcelona. I hadn't heard good things about Madrid so we skipped that. Lisbon was OK, but it was at the end of our trip, rainy and a bit frustrating. We had 3 nights and that was enough there.
Let me know if you want anymore details, but our favourites by far were the areas around Lagos, Seville and Granada. Rental cars really make it easier to move around some of these areas.
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