So a few months ago, I started a similar site in Hebrew[1].
My rationale was similiar to the OP's: most Israeli techies have no problem reading English, but when it comes to posting comments or writing blogs, lots would prefer Hebrew. Still, there are differences between the two sites: a site in Spanish has lots more potential HNers, but on the other hand, a site in Heberw has the benefit of supplying Israeli-specific news.
While my site hasn't yet taken off, I'm certainly encouraged by similar efforts that do succeed. So kudos to the OP, and good luck!