If I read between the lines, I sometimes feel the British Government would like to be shot of Gibraltar and hand her over to Spanish control. The Britain and Spain would both be happy and everything would be hunky dorey? Not a bit of it. When referendums are held in Gib, the results would make the leader of a one party communist state over the moon. Almost without exception the whole island votes to be British. Spain and Britain were talking of some deal recently and left the Gibraltarians out of the talks. The Gibraltarians reaction was to hold a referendum where well over 99% of the population voted to remain British. The Spanish-Anglo talks collapsed almost instantly.
Now one thing Spain doesn't advertise much is that she has two of her own Gibraltars (Ceuta and Melilla) on mainland Africa, and the Morrocans want these back even more badly than the Spanish want Gibraltar. The Spanish response to this is? We won't even discuss Spanish sovereignty of Ceuta and Melilla. A little hypocritical in my opinion!
Spanish feeling on Gibraltar does run quite deeply however. When I was at Uni, I had two friends who had both been born and bred in Spain. One lived in
Barcelona, and the other in the Basque Country. They would argue until the cows came home that "We are NOT Spanish". Many people in
Barcelona consider themselves Catalan and not Spanish (and so did my friend). The Basque, well I'm sure people know of ETA that wants to separate the Basque Country from Spain. Well my Basque friend certainly didn't fall into that category, but he certainly wasn't Spanish either. One day I got a bit fed up with their rants on anti-Spanish this and that. and I dropped Gibraltar in the equation, and added "and of course she is British". Both of them suddenly forgot all about their lack of Spanishness and immediately started arguing quite heatedly that Gibraltar was Spanish. When I asked why they should care as neither of them were Spanish, I got a rather sheepish silence before one piped up that he felt that way because "The Spanish are nicer than the English".
Some of these arguments aren't always that logical, they just have rules that neither side will deviate from.