Yeah, Japan will focus EITHER North or South, so going for the Philippines means less worry about Korea, less getting rubbed up the wrong way by Russia and no R-J War as we know it
The distances are longer, but Formosa would be a staging point for the army, and the navy would outclass the Spanish enough
It does of course depend on WHEN - IMHO its only really feasible once the Sino-Japanese War has been won, since China would be too much of a threat on the border otherwise.
The Spanish of course would have the Cuban fleet to send round the world if they felt like but the Americans may still do something there, assuming that Japan here gets in before the SAW breaks out
The other problem would be the reaction of the powers - see the unity from them over kicking Japan out of Liaoyang after the Sino-Jap war! Of course, if what we have done is remove the SAW and its 1899, 1900 then the unity of the powers is broken by such things as Fashoda, and the outbreak of the Boer War, and in the Far East you also have the Boxers in 1901 (which however did see a unification of effort, but then it WAS against China!)
Best Regards
Grey Wolf