Welcome to Flyertalk Yu Tao and welcome to the BA forum. I am sure you can see the advantage of this forum in terms of sharing issues.

I'm struggling to work out what to advise, however my suspicion is that if you were to ask someone at T5 they won't know anything about this, at the point of checking in, and yet having received an email like that you would be strongly tempted to go to significant and pointless work to meet the non-existent critera. The best I can suggest is that someone who is travelling to Iceland and who has received this message, can send screen shots of both the email and the Embassy response via Twitter, to the Social Media Team at Newcastle, who will then have the uneviable task of sorting this out.