Amos- I've been all over Iceland a few times now, so have stayed in a wide variety of places. Probably my favorite is staying in the mountain huts (bookable, 4x4 not always needed, some have a 'mountain bus' service passing close by) Hvitarnes is idyllic, close to the shores of a glacial lake. Hveravellir is right slap bang in the interior, in the middle of what is to all intents and purposes a desert, and has some amazing hot pools. Tourists by day, you have it to yourself from 4:30 onwards. You can camp (stunning) or stay in the huts- like old school youth hostels. Myvatn- hotel is supposed to be good, but the Reykjahlid campsite, closest to the village offers wonderful views, fantastic ambience and cannot be beaten.
Akureyri is really nice, sort of like a nice Swansea or a nice Plymouth, but MUCH smaller. Reykjavik is fantastic. Acommodation can be tricky to get, we stay with friends. Loads to be had out of town though, try Hafnafjordur park! (a proper site, in a park) We ended up having an impromptu infant school play session one morning as Mrs Ambrose is an infant teacher and the school uses the park. Everyone is SO unbelievably, amazingly friendly
To be honest, of all the places I've stayed in the worst was.... well I can't think of a bad one at all. Give me a ring if you want, there is a LOT to tell. Oh- have you seen this, a lovely treat for your wife
And this place is high in the mountains above Myvatn, views of midnightish sun, and the northern lights....
Call for a chat if you want, O778O988381
I cannot rate Iceland highly enough. It is proper breathtaking, everything about the place impresses. They Really have it all. Apart from a working economy that is, but hey- I'm on holiday!