A 22-lb carry-on limit doesn't strike me as unusual, it would be a full 22-inch bag. Unless you're carrying weights or books or something. Packing as light as you can, whether you check or carry on your main bag, makes for an easier trip.
We've flown Icelandair several times to Europe and plan to again this spring. They do a good job. They use narrow-body jets which aren't perhaps as comfortable as the wide-bodies others use, more comparable to domestic flights. The short layover in Reykjavik has been adequate in our experience -- it's a small compact airport, very well organized to move hundreds of people through the hub between Europe and North America in a short time window, twice a day.
Unlike the nonstop carriers, but like domestic carriers, they do charge for meals. So you may want to bring your own food on board or be prepared to buy from the airline. To me, this is an acceptable tradeoff for cheaper flights.
If you sleep well on flights (there must be some who do), the interruption to change at Reykjavik would be a disadvantage. I wish I had this problem. ;-)