The Kingdom of Granada was able to coexist 280 years (1212 Navas de Tolosa -1492 Fall of Granada) with Castile mainly for 3 reasons:
a) Very hard terrain to conquest.
With Sierra Nevada on its north-eastern side and Sierra Morena on the west, with a light and fast semi-guerrilla terrain-expert defensive-trained army supported by a defensive network of military structures built during the last 500 years of presence and supported by its Muslim brothers made the conquest extremely difficult.
It took 10 years for the combined armies of Castile and Aragon(1482 to 1492) to be able to finally conquer Granada, and only during the granadan civil war and diplomatic offensive carried out by the Christian kings. Just to get in context, Granada was fighting against basically the same army that 3 years later started mopping the Italian floor with French soldiers and didn’t stop fighting and winning battles worldwide for 150 years.
b) Castilian instability.
Up until de ascension of Isabelle I, Castile was ruled by a succession of inept kings (For example his brother Henry III or his father Henry IV) maintained in power by a strong nobility. When kings weren’t as docile as needed, Civil war waged all over Castile. From 1282 to 1479 Castile suffered 5 civil wars.
c) Granada’s relative prosperity, stability and diplomatic movements.
Given their southern Muslim neighbors open to trade, their fairly rich terrain for agriculture and a 25% Slave Christian workforce population, Granada was able to keep its population prosperous and willing to fight for their independence. Still, ever since the foundation of the Nazari Kingdom, Granada had payed and acted as a vassal state of Castile (Jaen Pact), avoiding its extinction (except in very concrete moments).
Historians are usually more or less confident that Granada was doomed ever since the Battle of Navas de Tolosa (1212) and that its conquest could have been achieved even sooner if Castile could have maintained a long attrition war, which she couldn’t up until the last few lustrums.
So, relative to the game:
I’ve been playing Paradox’s games for a long time and I’ve never really thought that they’ve focused much on Iberian aspect of the game (being them the ones that opened the colonialism of the world and dominated Europe for 100 years of the game time span).
Some suggestions are:
-Make Granada very difficult to conquer (maybe by a very high attrition province modifier, random events for 2000 armies to appear onto the sieging Castilians etc, Make it richer so she can bribe Castile to peace and to maintain it a vassal (Avoiding being annexed))
-Make Castile unstable enough to be unable to focus in any other thing that are not noble revolts, crown claims and inept titular kings until the arrival of Isabella.
IMO Isabela is the main key of almost everything about Iberia.
She unified Spain by marrying Ferdinand II of Aragon and by fighting and winning Portuguese, French and Castilian nobles in the civil war.
She was the one that invested on Colombus and basically discovered the new world (by selling her own jewelry), starting the first trans-oceanic empire.
She promoted the war against Granada and won in.
She conquered the kingdom of Naples with the help of Aragon and she got involved in the Navarran civil war.
She made the first laws to protect the native Americans Indians in colonial spain, which no other country ever did up until a century ago.
She employed the best in the court, helping to the advancement of areas such as military tactics (The Tercios were created by Gonzalo Fernandez de Cordova, General under her orders)
She married her daughters to several future kings which finally rendered also a huge European empire (Cataline with Arthur, heir to England and afterwards to Henry VIII, King of England – helping to the future ascension of Phillip II of Spain as king of England 1554, Juana to Phillip son of the Emperor Maximillian of Austria making Isabella grandson Charles I of Spain and V of Germany heir and then ruler of Austria, HRE, the lowlands, Spain, parts of Italy and France, and finally the marriage of Maria with Manuel of Portugal, which enabled Phillip II become also kings of Portugal.
So please, give Isabella some love
BTW, good luck, youll need it