Not sure if some of this is repetitive but here it goes anyway:
1.) What are some fun/interesting things to do?
Barcelona is a dream. Fantastic city - easy to get around, great food and lots of stuff to do. Take a half hour train to Sitges which is an uber gay friendly little town.
Ibiza is phenomenal but I was surprised it was not as gay friendly as I thought it was going to be. Not homophobic by any means but you do need to watch it. If you like clubbing (like I do), you will be pleased. Definitely try Pacha, Amnesia (they have a famous gay party called La Troya) and Space. It's an experience like no other and stunning beaches as well. Ibiza is a huge cash grab though - prepare to spend 30-60 EU to enter a club and 10 EU on water / up to 18 EU for drinks.
2.) How good does my Spanish need to be? (I can count to 10 and say "Where is the bathroom?" right now).
I speak no Spanish and found it OK.
3.) Beard or no beard?
No beard - it's summer
4.) Other tips?
Watch for thieves in bars and on the street. Very common in Barcelona. When some hottie grinds on you, go ahead but just ensure you watch where his hands are going.
Enjoy the food!!!