I flew VFR from Hofn (SE Iceland) to Wick in a Cirrus SR20 almost entirely at 1500 ft a couple of years ago. So it is quite possible.
Snags ? Helps if you have an autopilot or you will really have to avoid getting distracted from basics. Poor comms unless you can get some kind soul at the high flight levels to relay. Iceland ATC was reluctant at first until I suggested I would report at the normal reporting points applicable to IFR flight. GPS essential therefore.
By the way, Hofn is now no longer an airport of entry/departure for Iceland. Nearest equivalent is Egillstadir (BIEG). Further from UK of course. Suggest land in normal office hours or you will be gouged for a lot of Icelandic kronur for customs attendance - US$ 220 if I remember correctly.
Never been to Vagar but it has a fearsome reputation. Check weather very carefully indeed because alternates are practically non-existent.
SI