If you only have half a day transiting between a flight from North America and an afternoon flight to Europe, you can still see a little bit of Iceland. Take the Flybus into Reykjavík, and ask to be dropped off at the Hotel Borg. Ask the concierge at the Borg to put you on the 11 AM tour to the Blue Lagoon, which will get you back to the airport in time for 4 PM flights.
Walk down Austurstræti until it becomes Bankastræti past Laekjartorg and see if Kaffitar is open; it's a great place for pastries and coffee. Walk back to Laekjargata and take a left, passing the Government House, until you get to the base of the little Tjörnin lake. Take a right and walk past the city hall to Aðalstræti. Follow Aðalstræti down to Hafnarstræti, and take another right. You'll end up pretty much where you started.
Now walk back down Bankastræti until you can veer right on Skólavöðustígur. Walk up Skóla to Reykjavík's major landmark, Hallgrim's Church, which opens at 9 AM most days. (It should be about 9 AM now.) Get a panoramic view of the town from the church observation tower, and then do a little bit of shopping along Skóla as you walk back to catch your bus to the Blue Lagoon at the Borg.
With one day in town, do the same things we listed above -- the Blue Lagoon beats any Reykjavík museum. When you get back to Reykjavík in the afternoon, check into your hotel, explore the goldsmiths along Laugavegur and grab the #140 bus down to the Viking Restaurant in Hafnarfjorður for dinner.
Two days lets you take a full-day tour your first day. Pick either the Golden Circle, which combines a waterfall, a continental rift and a geyser, or a cruise to the Snæfellsness Peninsula. Grab dinner at an unpretentious Reykjavík bistro like Vegamót.
With three days, you should do the Golden Circle tour and a half-day riding tour with Eldhestar. In the afternoon of Day 2, check out a public pool, either at Laugardaulur or Arbærslaug. Yes, we know that means you'll be swimming on both Day 2 and Day 3, but that's very Icelandic.
With five days, you should get way out of town. Go either north or south. For a northern route, fly to Akureyri and rent a car (though you can do all of this by bus, too). Check out the waterfall at Goðafoss and go whale-watching in Húsavik your first day, then spend your second day at a hotel in Myvatn like the Hotel Reykjahlid; visit the lava park, the bubbling mud pits, and the new spa. Fly back on your third day. On your fourth day, go on a full-day riding tour with Eldhestar. On day five, do the one-day itinerary above.
For a southern trip, fly to Höfn and rent a car. Spend your first day touring the Vatnajokull glacier, and possibly taking a walk in Skaftafell. Drive back along the south coast and take the ferry to the Westman Islands on day two; stay in Heimaey and check out the bizarre effects recent volcanism has had on the islands. On day three, drive back to Reykjavík via Selfoss and Thingvellir National Park. Spend day four in Reykjavík; drop off the car and check out the old manuscripts at the Culture House and the swimming pool at Laugardaulur. On day five, head to the Blue Lagoon before flying out.
