Why is there a mix of English and Spanish dialogs in Narcos?

This is an out-of universe thing to make it easier for the viewer.

It would be more realistic if they kept talking Spanish (in most cases, at least), but the characters switch to English because that's the target audience's native language.

There are some examples of this in other movies/shows:

In The Hunt for Red October, Sean Connery plays a russian captain. The movie starts off in Russian, with all actors speaking Russian. But once the viewer is familiarized with the fully Russian setting, all Russian sailors start speaking English.
However, in-universe, the Russians are still speaking Russian (as is evidenced in their communication with the Americans).

While both sides (Russians and Americans) are speaking in English (in the movie), they are actually speaking different languages (in the story).

In Vikings, there is a clever shift between languages. Before I explain how it occurs, a small listing of the languages and how I'll refer to them:

• In universe, the characters speak either Norse or Old English (OE).
• Out of universe, the actors speak English, and some lines are spoken in their true language. When I say "English" in the rest of the answer, I'm referring to the language spoken by the actors, not the language that's being spoken by the characters (OE or Norse).

Vikings shifts English as the "current" language, after both parties have shown to speak the same language. An example:

• A enters a room, B is already inside.
• A says something in (actual) Norse
• B replies in (actual) Norse
• From this point on, A and B speak English for the ease of the viewer, as the scene has already established that both characters are actually speaking Norse.

A language switch can occur:

• C interrupts the conversation, and says somethin in (actual) OE to A
• A responds in (actual) OE.
• From this point on, C and A speak English for the ease of the viewer, as the scene has already established that both characters are actually speaking OE.

But then:

• B wishes to interrupt the conversation between C and A, but he does not speak OE. Therefore, he makes his statement in (actual) Norse.

Notice that the language used by B's actor changes based on the context of the scene. When there was a Norse conversation going on, the actor spoke English (as he was partaking in the conversation). But when an OE conversation was going on, the actor speaks Norse because English is currently being used to represent the OE conversation.

• However, if B was capable of speaking OE (and he did actually say something in OE), then B would be making his statement in English.

English (the language spoken for the viewers) is basically "the common language", which can shift based on which characters are currently conversing.
In order for it to shift, two characters speak to eachother in a given language, which makes this shared language the new contextual "common language", which is then represented by speaking English.