Yes, paying in full at the time of booking is the norm in Iceland.
We have used Troll for Katla, and we did a day long trip in the winter with Troll that included the glacier hike at Solheimakokul. The operator of that though was Icelandic Mountain Guides. We would have booked directly if it was summer and we could have driven, but that was not the case. Up in Grundarffjordur we have kayaked with Vesture Adventures. We have ridden horses at Heydalur in the Westfjords as well as at Eldhestar near Selfoss. The glacier lagoon we have done a few times and book direct, www.icelagoon.is . On Westmann we did the rib boat safari ride (2 hour) and booked direct. All hot springs we book direct, except on our 2nd trip where 2 of them their websites were not playing well with US credit cards, so one told us to book through Guide to Iceland and the other said to just pay when we arrived. Most of those credit card issues have been worked out since then. Up in the Westfjords we did a hike at Hornstrandir and a kayak trip right there in Isafjordur, both through Borea Adventures who is the operator for both of those. Last summer when my husband was there he did a whale watching tour out of Reykjavik as well as a fishing trip. I can't remember what companies I used for those, but did book direct.