Obviously the service charge only applies if you chose the optional external service provider (VFS, TLS etc.) instead of an application directly at the embassy.

Also see my response here:
http://filipinaroses.com/showthread....l=1#post582233

But other than that, unless her residence card explicitly ' EU/EEA family member' (those who did or are doing the Surinder Sighn route will have such a permit) she cannot travel visa free. She will be eligible for a free visa, issued ASAP and with minimal hassle (the Spaniards never heard of no hassle though, they loveeee red tape and asking too many documents) etc. Also see: http://europa.eu/youreurope/citizens...y/index_en.htm