Check out some true spanish/flamenco players and you would be amazed at what they can do, I strongly recommend Paco de Lucia, the father of modern flamenco music. Spanish guitar music is derived from classical guitar music, both utilizing strong right hand technique (fingerstyle). The main difference is that flamenco players will rely on fast free stroke playing w/the right hand while many classical players will do more rest stroke technique to achieve better tone and sustain.
What your are referring to w/Slash is the american way of incorporating spanish style phrasing on electric and steel string acoustic, techniques mastered and performed by Al Dimeola. This technique is known as double picking, were the right hand moves twice as fast as the left, essentially playing every note twice. Right hand string dampening will offer a cool percusive sound to this technique.
Main scales used; Phrygian and Harmonic minor.
You should really check out Paco de Lucia, he's so cool. You don't even have to be a fan of spanish/flamenco music to appreciate his incredible speed and overall musical brillance, I really can't say enough good things about this guitarist, and I've listened to a lot of players and I'm a tough critic.