blackbirch:
I am not much interested in pain, for me or others
See, that's where things went wrong right there

So, also speaking only for myself - ditto everything Spankedjenny said, 99 times out of a 100. I don't get many spankings anymore (only rarely want them these days), so this is all based on experience from years ago, not very recent.
But I don't think it's purely fantasy. I mean, in general, feeling arousal from pain is one of the basic tenets of masochism, and I wouldn't be going out on a limb to assume a lot of people who like to get spanked are masochists, would I? (I'm pretty sure I can't be the only one...) Most discussions on this board are about the d/s part of bdsm, but some of us actually prefer the s/m part.
And while I think in most cases you're right that pain precludes arousal during the event, research does exist that shows that it can go the other way, that arousal can preclude pain, even really bad pain. (This research is not necessarily spanking-related as far as I know.) Anecdotally, and still speaking only for myself, that has been true. I wanted it to be true almost every time, but alas, it only worked out that way like, three or four times over twenty years
I think there are two factors that made it possible. One, only OTK. While bent over a cold table, nope, don't see it happening. And two, only during hand-spankings, not when any implement was used. I'd say the type of pain from any paddle-like implement (spoon, brush, actual paddle) is not conducive to arousal at all. I often thought belts felt like they might have some potential (there's that weird tickle underneath the burn), but it didn't happen. Canes, no idea. I'd guess not - too slicey and stingy?