Well, the back room of Spain is a restaurant, and actually a nice looking one. I have never tried their food, but there often seem to be clandestine meetings going on back there. However, the entire front is a bar, and it's a really genuine dive.
For one thing, it's so cheap (most drinks are $4 or less, and the sangria pitchers have got to be one of the more impressive alcohol/dollar ratios offered in NYC). It's also incredibly dingy. It attracts characters that you would expect to see on most quality HBO shows, including The Sopranos, The Wire and Curb Your Enthusiasm. One time, there was a Viking woman there, with horns and everything. I don't mean some girl who thought Viking horns would be cute. I'm pretty sure this was a for-real Viking woman from 1,000 years ago, complete with gapped teeth, insanely frizzy blonde hair and the body of a rhino. If I was a time-traveling Viking, I would've visited Spain too.
Also, there is no real lock on the women's bathroom stall. You can lock the whole bathroom, but you can't lock the stall. I mean, you don't get much more genuinely dive than that.
They serve free tapas with drinks, but it's all a clever plot to get you to drink more. There are two free tapas they always serve: potatoes and meat balls. The potatoes are drenched in hot sauce and salt so you have to drink a bunch in order to survive eating even a few. The meat balls are made of some unidentifiable animal—different friends I have taken there often guess different animals. Probably cow, but my friends report that there is something not quite cow about them. There are always six of them, all skewered with a toothpick. They look more like testicles than any other food I've seen, including actual testicles. They also serve quiche (again, quite salty) but only occasionally. You are very lucky if you get quiche. It can really make your whole night, if it happens.
They provide dinner mints in a wooden bowl at the door. They look like they've been there since 1975.
They have two TVs; one is usually playing something normal like a sports game or the news. The other plays something ridiculous like Telemundo, pedigree dog shows or just back-to-back infomercials. There is a 90% chance that you will see Jeopardy or Wheel of Fortune at some point on any night, on either the normal TV or the whacked one.
Finally, the owner of the bar seems to HATE his customers, with the exception of native Spanish speakers from Spain. Not competent Spanish speakers or fluent Spanish speakers with an accent. Not even South American or Mexican native speakers. If you want to be treated nicely, you better have been raised in Spain. Don't get me wrong: I really respect this guy, and he is hospitable despite his deep animosity toward everyone, if that makes sense. Perhaps because he is open about his dislike of his own customers, everyone just seems to dig it and give him a pass. Once, I put my bag under my stool, and he almost tripped on it, though it really was tucked under there well. He angrily said "Are you trying to kill me?" I told him no, but clearly, it was an unsatisfactory answer.
He often looks out over his bar with barely disguised disgust. He has got to be in his 60s (at least) and there is a picture of him when he was about 30 years younger behind the bar. He is wearing the exact same look of disgust in the picture.
It's also a bar that seems to invite bleeding incidents. I got a torrential nosebleed (I know, that's a disgusting way to put it) and my friend's finger started bleeding one night too. Both times they discreetly took our disgusting bloody napkins before we could take them to the garbage and dispose of them ourselves. Disposing of someone else's blood? THAT'S service!
I just made it sound terrible but truly, it is inimitable, and the bar I frequent more than any other.
UPDATED: Oh yeah, Spain Bar is at W. 13th Street and Sixth Ave.