Well, apart from that LH might have handled the actual rebooking a bit better... why did you book DEN-MUC-KEF-MUC-OTP in the first place instead of flying DEN-MUC-OTP? Was it so much cheaper to go through KEF? Of course, then LH ask $$$ for skipping MUC-KEF-MUC. And to be honest, I would guess all major carriers would do the same.

I also do not get why you spend 90 minutes on the phone causing you to miss you KEF flight. I would have just thought "Ok, scr** it, I'm going to KEF" and saved the $$$$ when I found out they want so much money or it was obvious I would miss the KEF flight because they can't figure out how to rebook me.