Well, I cannot be of much help, but...
1. Yes, there are prepaid cellphones in Spain. We have recently reached the First World and the cell phones came with the welcoming package.
2. There are 3 cell phone companies in Spain:
Movistar , belonging to the Spanish equivalent to Deutsche Telekom, Telefonica. Website in Spanish
Vodafone , yep, that thing written on Schumi's car and in Beckham's ads. Website in English or even German.
Amena , English Website.
Help yourself in the Websites.