The location of this hotel is absolutely fantastic and is definitely worth a visit. However, as this hotel is the only one in this remote area, this probably explains that they can charge so high rates for the rooms there (150 euros / night for a double room). The price is absolutely not justified by the service provided.
There are 4 small rooms per cottage, with a toilet and a small handbasin with cold water and no shower. There are only a few showers for the 90 people staying in the area and they are only open 4 hours a day. The breakfast is ordinary but included in the price.
There is a very basic and dirty kitchen you can use if you don't want to pay for the restaurant which is really expensive as well.
The staff is for most of them not friendly at all.
Regarding the area, there is a hot pot if you walk about 30 minutes but this is absolutely not worth the walk compared to what can be found in so many other places in Iceland.
For information, there is no river crossing to reach the area.