My wife and I are planning a self-drive trip around Iceland that will last about two weeks (including two or three days in Reykjavik)in July or August. We are interested in doing day hikes (as opposed to overnight camping hikes) that will expose us to the best natural wonders Iceland has to offer. We would envision going to several small towns or villages for two or three days each using a guest house or a modest hotel at each location as a home base from which to drive to hiking locales. Thus, my queries:
1. In a drive around Iceland, from Reykjavik and return, what would be your advice about the best three to five destinations to serve as the base for several days of hiking (hikes of 3-10 kilometers, depending on terrain) at each?
2. What is your list of favorite hiking areas or hikes in Iceland? (We'd be especially interested in your "not to be missed" suggestions.)