Long overdue update on Iceland - figured no one was going anywhere anyhow
First, only way of getting there, as far as I could tell, was to take a ferry from Hirtshals via Torshavn, Faroes, to Seydisfjordur, Iceland. Hirtshals is located on some sand in NW Denmark, there are some ferries from Scandinavia to NW Denmark but for the rest of the world it's not much of a hub, but, Denmark is a small country, so driving to/from Germany is four hours (call it 6 in a 101, or call it a day and visit some nice cities). On the way back we went towards Copenhagen (camped in Roskilde for some days) and hopped on a nice ferry for much of the way. In Hirtshals and surrounding areas there's plenty of camping and accommodation, nice beaches, nice towns etc.
The ferry to Iceland is operated by Smyril Line - it's expensive and the beer is terrible (from what I could tell Faroe beer comes with "tasty" preservatives... I'm sure there is some absurd back-story to this. Anyhow, the ferry goes to/from Iceland via the Faroes (didn't stop off as I was seriously worried about the beer).
Arriving in Seydisfjordur my wife and I immediately enjoyed the nice clean air and we imagined that the surrounding scenery, hidden by the fog and low cloud cover probably was stunning - in fact, it is a beautiful location as my daughter and I were lucky enough to see on our return journey. There weren't any memorable border formalities, apart from paying to have the fishing equipment disinfected which I imagine was relatively expensive, but I chose not to focus on the cost of this or anything else in Iceland - I was there back in the 90s and went around in a hired 4x4 (Suzuki) and already knew that Icelanders fully understood that money has no inherent/intrinsic value, something I learned too when I paid about GBP120 for pizza for three people.
After getting off the ferry we left Seydisfjordur and headed inland up into the mist. Soon we were climbing a steep track, crossing a few small streams and once beyond the coastal mountains we were up on the central lava plain. Luckily there was pretty good visibility and we spent out first few days exploring the central plain, going for some walks up to some glaciers and mountains. Any map of central Iceland will show lots of sights worth seeing but it's good to check that routes don't become dead ends, unless you've got the time for it. It's normal for some routes to be closed because they're deemed to have become damaged or they're too wet to drive. There are always water crossings and most are pretty minor, but there are some deep crossings which a normal 101 should not attempt - what I found is that if you look at a map and see unpaved roads and "4x4 only" tracks then they're all fine to drive... it's when you start looking harder and accessing specialist maps that you can find tracks which are either unpassable or not a lot of fun to drive due to being very demanding.
Driving with the wife we were in a bit of a rush as she needed to get back to work, so we pretty much crossed the interior, visited Landmannalaugur and went to Reykjavik - this meant seeing and experiencing volcanos, lava fields, hot springs, geysers, water falls, rivers and in general the "other-worldly" landscape of Iceland all in about a week. Travelling to/from Iceland by air is, or at least used to be, easy and fairly cheap.
After the Reykjavik airport drop-off, I went fishing for a week. I had bought a national fishing card/license and looked for the most inaccessible lakes and spent about a week "wild" camping (with permission from landowners) at two lakes and visited another for a day. Iceland is a fishing destination - coming from Norway the big difference seems to be the trout fishing - only caught one small arctic char (released) and I basically ended up eating trout three meals a day for a week to make sure nothing went to waste. I caught everything on sinking flies/nymphs. My largest trout was about 4kg/8lbs+, which is a good size fish and I was able to release it, most "late evening" fish were around 2kg/4lbs+. The downside to fishing in Iceland is that if you fish late evening between the hours of nine and eleven at night, you'll catch all the fish you can handle, but fishing during the rest of the day yields fewer and smaller fish. I spent the days reading, walking, sleeping, relaxing and preparing and eating trout! Another thing worth mentioning about fishing is that most fishing is private and even if you have the fishing card you're supposed to check in with the land owners - instead of being a hassle, this ended up being a bit of a treat as it's a chance to actually meet local people.
At one lake I also ended up towing a local fishing card holder out as he'd gotten stuck. Later on, heading back to the Reykjavik airport the major ring road, I managed to cram a couple of cyclists and their bikes into the back for a to drive through a tunnel, barred to cyclists/pedestrians, which went beneath a fjord. It always feels nice to be of assistance in that "101 way".
After the week of wild camping I visited a normal campsite that had laundry facilities and did a few weeks of washing in preparation for picking up people at the airport. I also did a bit of maintenance: unclogged an axle breather, changed some inner tubes, checked/replaced some fluids. The inner tube debacle was the only "serious" issue I had to confront on the whole two month trip and was totally due to the fact that the wheels were old and rusty and rust flakes were abrading the inner tubes causing slow leaks (ok, "bad maintenance").
At the airport I picked up my daughter and three other families from the UK/South Africa/USA, and one seven seater 4x4 rental car - now we were 13 people in two cars; by the time the 101 was loaded with six people and pretty much all the luggage/supplies it was the first time in my ownership it achieved a "proper" gross weight. Now that we were a large group: we camped at proper campgrounds, didn't eat trout three times a day, saw all the "sights" (we even took the 101 on a glacier, the rental had to be left a couple of hours walk away due to ground clearance issues). In short, it was a success, no one complained (a miracle), and the kids all wanted to drive in the back of the 101. We were very lucky with the weather, it didn't rain (much), which meant camping was nicer and the rental could make the various river crossings, though some people found the nights a bit cold.
After a couple of weeks I dropped some people off at Reykjavik airport and we left the rental behind for a tour of some of the "lesser" sights (Snaefell peninsula, "church" mountain, Vik and black beaches and the iceberg lagoon) - a week later my daughter and I made the return journey to Norway via the viking ship museum of Roskilde and the amusements of Copenhagen, and my journey to the south was over after about two months on the road (I started north of the Arctic Circle).
Facilities in Iceland were ok. Camp sites were ok - the "camping card" was, as the poster above said, a waste of effort/money. Super markets are well stocked and, compared to Norway, not expensive, compared to England, more expensive, compared to France, a total ripoff... Eating out was hilariously expensive, I think even young kids were able to learn that the value of money is only a figment of someone's deranged imagination (a valuable lesson).
So, Iceland is beautiful and impressive and, sadly, for most somewhat inaccessible.