55-minute layover

If both flights are on Icelandair you'll be fine. They're used to it. No immigration/passport control/passport check or customs in Iceland. You're just transiting through. However, you will have to go through security again. (This is a requirement of all arriving non-EU flights whether you're staying in Iceland or just transiting through.)

It's not a big terminal.

You'll do passport control/immigration and customs at Heathrow.

Sounds encouraging, thanks!
By the way, I have a Russian passport. Flying into the UK (UK visa) and continuing to the mainland (Schengen visa via Germany). And we're carrying on, no checked luggage.

Think again about carry-on. The limit on Icelandair is 6 kg/13.2 lbs.

Since you're transiting and not entering Schengen in Iceland, you still shouldn't have any problems. Get the boarding passes for both flights in Seattle.

The 55 minute layover is fine, but I don't think you should overlook the possibility of a nine hour layover in Reykjavik. 20 minutes away from the airport, you'll find the Blue Lagoon, a geothermal lake which is a world-renowned spa. There is even transportation to and from Keflavik Airport. There is a sauna, a cafe, and the price of admission is surprisingly inexpensive. Iceland is beautiful, so don't discount seeing even a little of it on an extended layover.

IcelandAir also has those great free stay-over policies that allow you to stay in Iceland for 3-7 days at no extra charge en route(it varies, check the site.). If you can take a couple extra days - you can see a place you may never get the chance to otherwise! =)

Thanks for the stayover suggestions. Unfortunately, I have only a limited amount of time and other places I am more eager to see. I only have a total of 18 days I can take off from work this year, and we are already using 13 or 14 for this trip. I'll have to check out Iceland some other time.

Anna an Chris...
I was just on the Iceland air site, and they seem to want an extra hundred twenty dollars for that "free" layover. That's for two days on a Seattle to Copenhagen junket. Maybe the did that since SAS isn't competing on that run any more.

Anybody know how to talk them into a free layover?

Anna, we noticed the change in airfare, too, when we chose a layover. Turns out it was because the day we chose to spend in Iceland (on the way home) changed our outbound flight to a Friday instead of a Saturday, and the airfare was higher on that date. But we thought that the extra $127 for the two of us was worth it.