You needn't worry about what legal rights you may have. BA has not decided to shorten your holiday. It has merely held you some space and will quite freely acknowledge that you are due a change if that is what you want.

You could, if you wished, extend the trip by a day. Or, in the alternative ask for the MAD connection on IB. You could postpone the trip or you could cancel without penalty.

All up to you. Don't wait long because the loss of your flight means there are others considering their options and if the IB connection is not available, the other choices get much worse.