Add Seville?

In a word, Yes. I loved Seville over all the other places in Spain we visited, and you have the time to do three cities without being too rushed.

Forgot to ask. Are you using open jaw tickets? If so, where?

There is a huge difference between northern and southern Spain - and even between Madrid and Barcelona. Barcelona is Catalon and has a different feel than either Madrid or Seville. 4 days isn't too much but it's a good stay to see the main sights and look around. Madrid is a new city by European (and especially Spanish standards), it was turned from virtually nothing into a capital in the 1700's so the architecture is newer and not particularly inspiring. Other than the Prado, which is one of the greatest art museums anywhere (the only museum yet where my wife said, "I wish we had more time."), and some really nice green spaces (if you're there at the right time of the year), I find Madrid to be skip-able. Toledo was the capital before Madrid and is a much better visit. It's easily reached by train from Madrid and is worth a night or two. Seville is nice. From Madrid you can catch a high-speed train from Atocha station, which is only a few blocks from the Prado. I'd also suggest making about a four hour stop on the way to see the Mesquita, and surrounding quarter, in Cordoba on the way to Seville. You don't have time to make the additional trip to Granada so will have to save that for another time.

Seven days is a lot for Barcelona, and Sevilla is well worth a visit, unless it is high summer when Andalusia is VERY hot. So yes, I suggest you shorten your stay in Barcelona to 4 nights and add three to Seville. It is only 2.5 hours from Madrid by high-speed AVE train.

Without knowing your dates or motivation for what you are planning, it is hard to make recommendations. Personally I think 7 days in Barcelona is about four or five days too many and you could get by nicely on three in Madrid. I would spend extra time in Toledo, Cordoba, and Seville, especially Seville. With the Moorish influence southern Spain is not Europe and we find that part of Spain far more interesting. So, I would encourage your idea of 3 days in Seville and maybe an overnight in Cordoba on the way to Seville.

I agree with Frank... spend less time in Barcelona and move south... it's charming.

Yes, Toledo, Cordoba and Seville, with 2 days in Madrid, 4 in Barcelona. Overnight stays are better for Spanish cities because they are lovely in the evenings and dinner's not before 8 p.m. It's partly because Spain is on permanent DST! While almost all of Spain is west of the prime meridian and should be on Greenwich mean time, it has chosen to be on Central European time. . . and yes, the move the clock ahead for DST as well.