Spain didn't absorb the Iberian Peninsula. Portugal was always more or less Portugal, the same with Aragon. The rest of the Kingdoms were slowly acquired by Castile.
In 1479, at the time of the dynastic union of the Crown of Castile and the Crown of Aragon (colloquially "the Spains"), there were only three Crowns on the peninsula, roughly controlling a third of the population each.
Attempts to merge the crowns of Portugal and Spain always fell through because the culture of the Portugese nobles and the Spanish nobles clashed (Portugese nobles being treated as second class).