Some of the protesters are going ahead with the people's assemblies. How the government will react is anyone's guess. What these folks are doing is creating an alternative to the government, a rival power. It's not clear how much support this revolutionary idea has with the general public.
What is impressive though is how well organized they are. The website linked below presents in a great deal of detail on how these assemblies will operate and under what rules. They are quite democratic, inclusive, and "horizontally" structured. This particular methodology is, to my knowledge anyway, unique. It differs from the Russian soviets (note the small "s") and the municipal councils of the Paris Cummunards.
I suspect the government will ignore these assemblies if they are not too large. If people throng to them, then the Spanish government will have to act forcefully. Then it becomes a question of with whom the law enforcement agencies, and perhaps the armed forces, will side.
The neighborhood assemblies will take place during the week, and then the big one will occur sunday in the Puerta del Sol. We'll see what happens.
http://madrid.tomalosbarrios.net/