A common sense check suggests that, if Spain requires you to renounce your UK citizenship, that's what you would have to do. If it doesn't permit you to have dual nationality, then you will have to choose between one or the other. Tricking things to get around the nationality laws risks making life extremely difficult, potentially losing both nationalities as well as incurring penalties. Unless you have strong legal advice from lawyers who specialise in such matters in both countries that this is possible, don't go there.

And the same goes for taxation, although you are more likely to find specialist books which will guide you as to the overall tax position related to your residence and whether Spain taxes its non-resident citizens.