I hate to keep posting, but I just love this topic.
When we stayed at the cabin on the farm several years ago, we were on our own for breakfast. But almost all hotels offer a breakfast, and this is what I have found to be fairly standard:
Bread and rolls, luncheon meats, sliced cheeses, cold cereals, cold fish of some sort...(herring, salmon), butter and jam-type spreads for the bread, cottage cheese, tomatoes and cucumbers, and some kind of pastry.
It really is pretty hearty, depending on your food preference. I have known people to make a sandwich "to go" from the breakfast buffet, which served as a light lunch.
You asked for some thoughts for a nice place for dinner to begin and end the trip. Is your flight to KEF out of SFO or some other gateway city? I ask because the SFO flt arrives in the afternoon, while all others are early morning. As your flight will be all night (however, this time of year almost the entire flight will be in daylight) an afternoon arrival will not give you much opportunity to rest at the hotel before dinner.
As I just have a hard time sleeping on planes to begin with, when you add in the 2 am daylight, I end up being a basket case the first night in Iceland. If you are really tired, you may want to save the nice dinner for later, when you are rested and will enjoy it so much.
That being said, I have 2 favorites: Cafe Opera and the Grillid.
Cafe Opera is on the second floor of an old building that is at the center of downtown Reykjavik. Nice service, good food, and when you are done, you can do a leasurely stroll around the downtown lake, take in the scenery, watch locals feed the ducks.
Here is a link to their menu:
http://www.cafeopera.is/en/offer.php
The Grillid is on the 8th floor of Hotel Saga. The food is great, you get an excellent view of the entire city, but prices are a bit steeper, but it is also more formal in nature.
http://www.discover-the-world.co.uk/...?id=restaurant
http://eng.grillid.is/GrillidEnglish/TheGrill/
The Pearl restaurant is nice, but IMHO, a bit too tourist oriented. Consider going to the cafe one flight down from the restaurant, having coffee and pastry, and then walking outside on the deck the encircles the Pearl. You get the great view of all of Reykjavik without the expensive meal.
Hamburger? Go to where the locals go......Habborgarabullan. It is about 2 blocks from city center, but the burgers are great. Here is a list of Iceland restaurant reviews, in case you don't have this link:
http://www.virtualtourist.com/travel...land-BR-1.html
Your trip really looks interesing. I'll have to check out the package deals on Icelandair.com and look into the ring road trip. Looks like it give you the freedom to see what you want, when you want, within a structure of knowing where you will be each night (and knowing that there is a place reserved for you).
You can go crazy trying to plan all this out. There is a lot to see and do, but I have found it all to be fun. You are going to have a great time.