anikha,
when your father was born, your grandfather had already become a filipino citizen.
it appears that your grandfather did not bother to register your father’s birth at the spanish consulate, that is why they couldn’t find his name.
your grandfather did not pass on the citizenship to your father.
your grandfather should have arrived in the philippines before your father was born.
when was your father born?
did your father ever lived in or travel to spain?
in the passport he showed you, was his name different?
if you can only prove your grandfathers citizenship,
you will have to apply for a working resident visa or a non working resident visa and live in spain as a filipino immigrant untill you get the citizenship.
you can start applying when you have completed a year of residency and must renew it untill you are granted the citizenship and passport and dni.