I spent a couple of weeks in the south of Spain, working... and not everyone actually napped, but everyone certainly took off from about 1-4 pm, or 2-5 depending. A friend of mine doing an MBA in Madrid also talked about a similar gap in the schedule. I'm not Spanish though, I'd love to know about regional/industry differences.

The siesta is alive and kicking in Mexico as well -- a friend of mine who's a well-to-do lawyer in Mexico City, his whole firm takes off 3 hours an afternoon as well, and he explained it's a pretty normal thing to do -- particularly so you can have lunch with your family. Of course, doubling your daily commute has its own problems...