Followup: was there ever a cohesive Iberian identity?
It appears that you've had various disparate groups fighting themselves, each other, and invaders throughout the entire history of Iberia. And when you look at various movements in Catalonia, The Basque Country, Galicia, etc. it seems like Spanish identity is more of a Pan-Iberian thing of dubious unity. So I'm curious about the wider divisions within modern Spain as well.
Why it is that Portugal is a separate nation, but those other places aren't?
This question has two parts that need to be addressed, the first is how the Portuguese identity separated from the rest of Christian Iberia and how the remainder of Christian Iberia unified into becoming what we know as Spain.
Originally Spain was the name for the Iberian peninsula during the medieval era, and the Kings of Leon called themselves the Emperor of Spain, this title was intermitantly used from 866-1157, and was sometimes held by the King of Castille. the title of Emperor refers to a military command, and was not seen as granting the Emperor any authority over non-military matters. After 1157 the title of Emperor continued to be used however after the death of Alfonso VII of León and Castile the users of the title of Emperor, did not gain any military authority over the other Christian Kings of Iberia, and the title became meaningless.
The next significant usage of a title with the word Spain in it was when Isabella and Ferdinand united their Kingdoms of Castile and Aragon, and started using the title King and Queen of Spain. It should be noted that before the 16th Century when people used the word Spain they meant Christian Iberia, however after the 16th century and the reign of Charles I, Spain gradually started to only mean the modern day Kingdom of Spain and not the entire Iberian peninsula.
Therefore while the Portuguese did once view themselves as being "Spanish" what they really viewed themselves as was Iberian.
The main difference between Portugal and the rest of Iberia was that the rest of Iberia was one country while Portugal is its own separate country, also the modern Spanish identity isn't as unified as the modern Portugese identity, as demonstrated by the various separatist groups like the Basque and Catalonian separatists. Modern Spain is mainly descended from Castile and the separatist groups are located in areas that were not in medieval Castile.
The main event that prevented Portugal from being a part of Spain was the Portuguese restoration war from 1640-1668. From 1581-1640 Portugal was under a personal union with Spain, and both countries had the same monarch. it is likely that if Spain and Portugal continued to be in a personal union the Portugese identity would be viewed as a regional Spanish identity, in a similar way to how Catalonian is viewed as a regional Spanish identity or Scottish is viewed as a regional British identity.
Portugal came under a personal union with Spain after Sebastian I died in 1578 at the battle of three Kings, the throne was inherited by his uncle the childless Cardinal Henry, after his death in 1580 Phillip II of Spain claimed the throne as he was the grandson of Manuel I of Portugal. And after fighting some battles against Antonio I who was another grandson of Manuel I, Philip became King of Portugal. Eventually his grandson Philip IV of Spain became King of Portugal and Spain in 1621, and he attempted to place Castilian Spaniards in high ranking positions in Portugal, resistance to Castilians being placed in control of Portugal resulted in a group known as the forty conspirators led by Antão Vaz de Almada to kill or imprison the leaders of those loyal to Philip IV like Miguel de Vasconcelos, and proclaim John IV as King. It should be noted that Catalonia was fighting its own war of independence against the Castilians known as the Reapers War at the same time, which goes to show that the Spanish identity was not unified at the time, and that success in their war of independence was what separated Portugal from the rest of Iberia.
Success in the war of independence prompted a rise in Portugese nationalism, resulting in Portugal reducing its cultural interactions with the rest of the Iberian peninsula and instead interacting more with the English and French, this gradually resulted in the Portugese identity becoming more and more separate from that of Spain.
Followup: was there ever a cohesive Iberian identity? It appears that you've had various disparate groups fighting themselves, each other, and invaders throughout the entire history of Iberia. And when you look at various movements in Catalonia, The Basque Country, Galicia, etc. it seems like Spanish identity is more of a Pan-Iberian thing of dubious unity. So I'm curious about the wider divisions within modern Spain as well. Why it is that Portugal is a separate nation, but those other places aren't?
/u/OllieGarkey's comment is going in the right direction, as it questions the idea that "Spanish" or perhaps "Iberian" has ever been a concrete cultural identity. It is clear that even 2018 Spain, which is politically unified as a single nation-state, still has deep regional and cultural divisions, most notably in Catalonia and the Basque provinces.
OP asks about a medieval divergence between between Spanish and Portuguese cultures, but it's impossible to explain a divergence if there was never unity. But what we can answer, at least, is why Portugal is not part of Spain, or vice versa. Medieval Iberia was a tapestry (medievalists love their tapestries) of shifting independent kingdoms, both Christian and Muslim (map in 1210). The kingdoms of Asturias, Galicia, Leon, Navarre, Castile, Aragon, Valencia, etc. competed for territory with each other and with, respectively, the Caliphate of Cordoba, the Almoravid, and the Almohad dynasties (not all of the Christian kingdoms listed above existed at the same time).
The County of Portugal was founded in 868 as a vassal to the King of Asturias, after the reconquest of the area north of the Duoro River and the city of Portucale (Porto). It remained part of Asturias and later Leon (after the division of Asturias) until the 12th century. Portugal eventually earned its independence at the Battle of São Mamede in 1128- Afonso Henriques went into battle against his own mother and her lover, the Count of Galicia (who in turn were supposed to be ruling over Portugal in the name of the King of Leon). Portugal, under Afonso I, would be recognized as an independent kingdom by the King of Leon in 1143 and by then by the Pope in 1179.
Side note: The connection to Galicia can still be seen linguistically as Galician dialects are more closely related to Portuguese than to Spanish.
Portugal, like the other medieval Christian kingdoms, engaged in the Reconquista. Lisbon fell to Afonso I in 1147, and by 1249 Portugal had conquered the Algarve on the southern coast. While the rest of the Iberian kingdoms slowly coalesced through war and dynastic marriages into Castile and Aragon, Portugal remained firmly established as an independent entity, strong enough to avoid becoming part of Castile, at least until 1580.
Sebastian I of Portugal's crusade against Morocco ended in disaster in 1578, with his death at the Battle of Alcacer Quibir. Sebastian left no sons, and so a succession crisis arose among the other grandchildren of Manuel I: Antonio, the elderly priest; Catarina, Duchess of Braganza; and Philip II, King of Spain. Needless to say, Philip had the largest army and thus was able to form the 'Iberian Union' of Spain and Portugal. Yet, Spain at this point was a composite monarchy, meaning that while each of the incorporated kingdoms had the same monarch, they largely maintained their own laws, taxes and customs (again, how even within Spain various cultures survived intact).
This led to frequent internal political conflict between the Habsburg Spanish kings and their territories. Castile, the largest territory with the weakest privileges, ended up paying for the lion's share of Spain's constant wars in the 16th-17th centuries. So the monarchy sought to get the other territories to pay what they saw as their fair shares for the defense of the entire polity. The Count-Duke of Olivares, favorite to Philip IV, envisioned a Union of Arms where each territory contributed a number of soldiers determined by their size, for example. But the attempts to create a more centralized Spain backfired, as both Catalonia and Portugal revolted in 1640, right in the middle of the 30 Years' War.
So why is Portugal it's own country while Catalonia is not? Because Portugal won their independence war, while Catalonia (despite help from France) was defeated. The six decades in a personal union with Spain did little to make Portugal more 'Spanish' and thus culturally and linguistically Portugal remained distinct. As it had always been.
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