Thanks for the notes everyone.
We're actually going to Iceland in May half term 5-6 nights. Paid cash for that booking with Icelandair as BA wanted crazy prices and no Avios seats were available.
We've gone for Krakow at the end of July. Looking at the temperatures, it doesn't look like it will be crazy hot (i.e. 30+) and it's going to be pretty cheap when we get there. Certainly a lot less than Iceland!!
Budapest is on the list - probably for 2018.