The word Guinea entered the language from Portuguese Guiné, (although the origin is unknown), meaning the region of the west coast of Africa from Sierra Leone to Benin. It came to mean, roughly, anywhere in West Africa.
In 1663, the British Royal Mint authorized a coin of 20s for use by the “Royal Adventurers” trading with Africa. It picked up the nickname Guinea (for the region of its intended use) almost immediately. (It picked up an extra shilling in value in 1717, and was worth 21s until it was discontinued in 1813.)
The term was also used to refer to people who originated (or whose ancestors originated) in the Guinea region of Africa.
It came into use as an insulting term for Italian or Spanish immigrants to the U.S. in the 1890’s.
Thus sayeth the OED.
I would hazard a guess that the reason the word was applied to Italians and Spaniards had to do with a general attempt to disparage them by associating their (relatively) swarthy complexions with an African origin. I do not have documentation as to why, only my best guess.
Tom~