Spaniards had been fighting against the Muslims for over 700 years at that point. By the time of Isabel and Ferdinand ("los Reyes Católicos"), Moorish possessions had been reduced to only Granada and a couple of other points in that area. (3/4 of Spain was NOT Muslim at that time, no matter how you put it.)
Initially, after the fall of Granada, los Reyes offered to permit at least one of the Muslim leaders to remain. However, he proved to be untrustworthy and was also expelled after trying to gather forces to fight against the Spanish again.
One of the reasons the Jews were expelled was that there was wide popular suspicion that they were helping the Muslims. I think that in most cases, this was simple bigotry and suspicion egged on by the fact that some people had much to gain by getting rid of the Jews. Many members of the court of Isabel and Ferdinand were Jews, and there was considerable jealously among lower ranks of non-Jewish courtiers. However, in at least one town, it did appear to be the case that Jews were helping the Muslims rearm.
No matter how you look at it, Islam has been a problem and a force for violence and disruption since the day of its founding.