3G in Spain - Can't Buy SIM Card

Traveling in Spain this month, attempted to get SIM card and monthly contract for iPad after arrival in Madrid (went to a Vodafone store). Clerk was adamant that we could not get a SIM or contract wthout showing a Spanish or EU ID (seemed amazed that we did not have a EU "passport" even though we made it clear we were only tourists).
Has anyone else encountered this weird, restrictive approach in Spain? From other posts in this forum, I gather that things work much more easily in other European countries, e.g., Germany, Italy.
So we're stuck with AT&T's exorbitant roaming plan for a paltry amount of data...

maybe if they believed you wanted a full tariff with them
that may require one living there or they'd have a hard time getting people to pay the bill each month
not sure about spain but most parts of europe sell prepaid sim at each gas-station

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