Hello Andromeda,
In response to your exact questions, please read:
1. Yes, those holding Latin American citizenship are only required two years of legal residency to be eligible for Spanish citizenship by residency.
2. As far as I know El Salvador is a Latin American Country, so Double Nationality Spanish/Salvadoran is possible. You can check this information at the Ministry of Justice Website.
3. You need to renounce to your Canadian Citizenship when getting the Spanish one as there is no Dual Citizenship agreement.
If you wish to discuss this issue further, please contact me by email ( details in My Profile ).
Regards,
Bookmarks