They took Crete and did not have to walk there. In OTL, Malta almost starved under the air punishment in 1942. As I said, with OTL supplies and forces Rommel got to The Alamein. With not much more, he could have taken Alexandria and repaired its port. Or used Tunisian Vichy ports if needed.
Your knowledge is right, Franco was in charge. But the winner side of the Spanish Civil war was not a homogeneus one. There were monarchics and there were pro-nazis, like Serraño Suñer, Franco brother-in-law and Foreign Affairs minister. The Falange was a powerfull movement closer to fascism than to the old generals, and that's why Franco got rid of it later. It would be easier to find a Quisling in Spain than it was in France. But the germans do not need to conquer all of Spain and fight a guerrilla war. Their only interest is Gibraltar, and maybe some of the Balearic Islands, and they can get there and do their job without patrolling the whole peninsula.
The point of this thread is that there is no war in the east. The resources used in the Med, even with Spain in the basket, -agree Turkey would be a foolish thing- are only a fraction of those saved in the east.
The only thing that would keep the british in this war, while Stalin is watching, would be an american intervention before, say, 1943.
The Reich doesn't have the lift to increase the number of troops, trucks tanks, etc. needed to change the balance in Africa. They also lack the ability to alter that simple fact. Germany entered the war with very little merchant shipping, virtually all of the shipping that belonged to the occuppied countries that was at sea during the invasions ran to either the Commonwealth, the U.S., or a neutral port denying the Wehrmacht access to that resource, and availble shipyards were inadequete for the needs of just the Kreigsmarine, much less merchant vessels.
On the other hand, Great Britain had shipyards to burn (they were able to have five BATTLESHIPS and four AIRCRAFT CARRIERS under construction at the same time as they were cranking out merchant vessels), and has access to American yards, as well as the yards of the Commonwealth. All together, these yards were able to outbuild the U-boats ability to sink shipping, even at the peak of the Battle of the Atlantic. The British yards were virtually ALL outside of the range of the Luftwaffe, and the Wehrmacht clearly had no way to get at yards in North America. The British also could ship directly to North Africa from the Raj, and Australia, or even get shipping from the American Pacific coast shipyards (long trip, but doable) even if the Reich managed to close off the Western approaches to the Med, something that is considerably harder to achieve than some posters imagine.
You can build a million tanks, but if you can only move 25 a week and are losing 20 in combat while the enemy is getting 250 and losing 150, your ass is grass.
Germany, in this scenario, has an ocean of resources, unfortunately for the Reich, it only has a 5 kilometer long garden hose to distribute it while the UK, which has an even bigger ocean to draw from, can pump the resources from a dozen fireboats right next to the dock. Logistics are boring, the opposite of glamorous, and a general pain in the butt. Logistics, however, also wins wars.
The Reich's logistics were unequal to the task proposed.