Thought I'd share a bit.
We stayed in Reykjavik two nights. Did a Food Walk which initially seemed expensive--about $100/ each--but after sampling foods from 6 different places, ranging from a hot dog stand to a high end restaurant, I thought it a good value. I think the food alone would have cost about $80 or more, taking sampling sizes into account. The Reykjavik Food Walk. Took about 3 hours. 12 people. Fun.
We took an Aurora tour that was quite expensive, Happy Tours. But what sold us on that tour was that they have a 90% success in viewing Their business model is to call whether to go/ no go as late as possible so that actually seeing the lights is likely. If the prediction for viewing is iffy, it may be worth paying more for this service. It was very cold and windy--dress as warmly as you can. One consideration about going out for us: being able to re-book for an unsuccessful outing is no good if you are not going to be able to do so.
Rented a 4 wheel drive car with studded tires from Blue Car. I think all rental places have studded tires and lots of 4 wheel drive as that is what you need. We saw the most dramatic landscapes. We went down a road less travelled on our Golden Circle trip because we were hoping to see a geothermal plant (one of the group is a chemical engineer) and while we did not succeed in that endeavor, we did find fabulous scenery and the ION hotel with an upscale restaurant. We missed the first turn off to Parking 1 at Thingvileer (phonetic spelling attempt here--forgive me) and turned in Parking 2. Would have been better to have begun at 1 but we backtracked and saw the major sites. Well worth the drive. Roads were clear. We watched the Iceland road condition site and the weather sites daily. You should do that. We drove from the Golden Circle to the South Coast as far as VIk--the day after we drove it the road was closed due to a gale--80 mph wind. Not gusts of 80 mph, gusts were > than that. We were glad to have gotten weather warnings ahead from the car rental company by email. I would ask if your car company does that at the time of rental. Prior to that we drove to Geysir-enjoyed that. To Gullfoss--very dramatic and beautiful. There are two parking lots there--if climbing stairs is a concern, you should check this out as the lower one will take you to the base of the stairs. To the crater lake--can't recall it's name--meh in winter.
One of our rooms was on a horse farm--enjoyed seeing the horses en face. Toured the geothermal plant Rick notes on the Golden Circle--gives a good overview of how it works. I enjoyed it.
Ate at the Olvik brewery close by that Rick mentions--thumbs up.
No Blue Lagoon, just didn't make it. But we went to a community pool in Rey. and the Fontana also; both are in the Iceland book, which we found invaluable. Both were very nice--though someone stole my rental towel at one!!! Put your rental towel in the top slot to discourage this .
That said, we found the people to be friendly and courteous and fluent in English to the point that we stopped asking if they spoke English.
Last note: the only trip that we have not exchanged for some currency. Cashless society.
Enjoy your trip--we certainly did ours!