Jamon Jabugo. If you eat nothing else in Spain, this ham has to be it. Not Serrano, which is merely good. Jabugo. It's expensive, but nothing comes close.
If you visit the Alhambra, try to have a meal at the Parador del Alhambra. It was many years ago, but I remember a white gazpacho made with ground almonds and garlic.
re: Pia R
The "white gazpacho" to which you refer is called "ajo blanco." It's originally from Malaga, and is the only member of the gazpacho family that doesn't incorporate bread--or at least the only one I can think of. I agree that it's delicious. Other strange gazpacho-like substances include salmorejo--a sort of extreme gazpacho concentrate from Cordoba involving more bread than tomatoes--and something they make in the province of Cadiz and simply call "ajo," the preparation of which involves mashing up gazpacho ingredients in a mortar and pestle. This leaves the bread lumpy and lends the dish an oddly Neolithic feel. Then there's sopa de tomate, which is a soupier version of ajo, served hot.
With respect to jamon de Jabugo, here's the deal: Jabugo is an apellation, referring to a town in the Sierra de Huelva which is the commercial capital of a vast zone of oak trees and pigs, and hence some of the world's best ham. All hams labelled "Jabugo" have to be from the town, and must be from Iberian pigs, which have black hooves. The pigs eat the acorns that fall from the oaks, exclusively. All Jabugo ham is good, but not all of it is the best: differences in curing time, slaughter weight, etc. all affect the end result. A good bet is anything labelled "Jabugo" from the firm of Sanchez Romero Carvajal, probably the best commonly-available brand. They actually own a few bars in Seville and elsewhere called simply "Jabugo," which serve their products exclusively and are worth seeking out, despite their overtly commercial atmosphere.
But in any case, great ham needn't be from Jabugo. Anything labelled "jamon iberico" (also known, informally, as "jamon de pata negra") is going to come from the same pigs--with the acorns and the whole bit--and although it may not be from Jabugo, it may in fact be better than a run-of-the-mill Jabugo ham. The best ham I've ever eaten wasn't even from the same province: It was made in the countryside around Cordoba by a very strange retired general in the Spanish army, who basically made hams as a hobby. This guy's nephew served it at his wedding, and it was one of the most amazing things I've ever eaten. Years later, my friends and I still reminisce about it--with alarming frequency, now that I think about it.
I couldn't agree more that jamon serrano is not even comparable to jamon iberico. They're just two different things, and one is infinitely better than the other. Most jamon serrano is about on the same level as a good prosciutto, and once you've had jamon iberico, you'll never really care much about prosciutto again. It's okay for sandwiches, I guess. In my opinion this is one of the very few instances in which the Spanish pantry outstrips the Italian, hands-down.
By the way, the left ham is better than the right. Or so they say.
Couldn't agree more about Salvador Rojo, recommended by Rory. Unquestionably the best high-end food in Seville, and by an order of magnitude. I lived in the city for over six years, and I only wish the joint had opened sooner...but Salvador's only in his twenties. Certainly it's expensive compared to the average in the area, but it seems almost absurdly cheap to anyone familiar with e.g. NYC or London. Or with Madrid, for that matter. See an earlier post of mine for further recommendations in Seville and Sanlucar: http://www.chowhound.com/boards/intl/...
And another post by someone else, with which I agree completely:
If you have a car in Granada, I highly recommend a day-trip to the Alpujarras, a string of villages on the backside of the Mulhacen--the huge mountain that dominates the area. This was the last place to be Christianized in all of Spain, and was in fact the site of an Islamic uprising long after the Reconquista was theoretically complete. You'll find that history reflected in the food: couscous, savory dishes involving fruit, etc. I remember walking into a bar there for the first time and feeling as if I'd fallen in among a secret community of Berber tribesmen. A staggeringly beautiful and (apart from a strong hippie presence in places) relatively undiscovered area.
Have a great time!