Let's suppose a communist regime is settled. Then they would have been included in the Germano-Soviet pact. Probably Hitler would have pressed Stalin to have free passage through Spain to attack Gibraltar. What could have happened then? When Barbarossa takes place Nazis backstab the spanish communists and occupy Spain. Britain would occupy the Canary Islands and probably Sahara and Equatorial Guinea, creating an exiled government there (they would not have wished to have hostile spanish population). Nazis would have also invaded Portugal.
WWII could have continued very similar to OTL, but soviets would have been in a better position as lots of german troops could be bogged in Spain and Portugal fighting the guerrillas. On the other hand the Germans could have controled the access to the Mediterranean. When the US enter the war there could have been a huge amphibious operation over the Iberian Peninsula with local support. But by that time Uncle Joe could be already entering Germany.
Finally Germany would be defeated, but the iron courtain could fall more to the west. Probably Germany would be divided with a neutral Ruhrland and a Popular Republic of Germany. Austria, Italy and Greece would also be commies. What about a Northern Republic of Italy and a Italy of the South! And an Italian War, instead of a Korean War!
The NATO would be the USA, Canada, Norway, United Kingdom, Belgium, Luxemburg, Netherlands, Spain, Portugal and France.