I hate to put a contrary view... and the details are not 100% clear from the original post. However, Fire Detection Loops aften have sufficient redundancy to allow MEL despatch with 1 U/S, and the MEL will specify how long it may be U/S. In my company, some apparently significant MEL items may go 120 days before required to be repaired. Sometimes with appropriate restrictions e.g. compartment to be left empty. It might be "mad" to routinely have to leave baggage behind, but that is the Mgmt's decision.
Naturally, the Captain not only has the right to refuse to accept an MEL deferrment, but indeed is obliged to actively consider whether it is acceptable to him for flight etc. However, in this day and age, it is fairly routine to have numerous MEL items, and to "refuse" I would usually need some further considerations i.e. the MEL items combined become unacceptable, there are special circumstances (e.g. weather) etc. Multiple irrational refusals will certainly awake the Mgmt machine
As I say, the individual circs of this incident are not clear, and I would be interested in (but have no right to) knowing further details. However, to whip a Sun newspaper type paedophile campaign against Iberia seems somewhat excessive... since on the evidence presented above, my company (and many others) routinely fly aircraft around with similar defects...
NoD