As a matter of High Theory, if this money produces an ROI in excess of its cost, then it does actually make Spain more creditworthy, even if this is senior debt. As a practical matter, this probably increases the variance on outcomes that could reasonably be expected; in particular, it increases the chances that bondholders will be wiped out entirely at some point.

At least, I think that’s the case. It would be if the debtor weren’t sovereign. Politics is deeply inextricable from how allocations of future income are going to be made, and I’m at a complete loss as to how Spanish politics is likely to play out.

Incidentally, I would think that most good faith holders of CDSes would hope that this doesn’t trigger them yet, because (as you note) they’re not likely to pay much if they do, and the position (short or long) goes away if it triggers. What buyers and sellers are hedging/betting on is not this scenario, but one that won’t transpire until, oh, at least next week, and a premature trigger would drive basis risk all to hell.