I have to agree that actual temperature is not that much of a problem in Dec. The main problem is when a storm blows in from the North Atlantic and brings precipitation and very, very strong winds, it can make being outside a less than enjoyable experience. Also, there is very limited daylight...sunrise about 11am and sunset about 3:30pm, tho you get an hour of twilight on both sides.
In Dec, downtown Reykjavik is really decked out in holiday colors and lights, so if you have never been there before, it is worth seeing. Check on hotels, as Christmas has become a quite popular time to visit, and rooms can be hard to find near the 25th.
I don't know if you are a fan of sunsets.....but I have flown from KEF-MSP several times in Dec, and you get about 2 or 3 beautiful sunsets viewable on the left side. As you fly southwest from Iceland, you cross the daylight/darkness terminator several times as the flight progresses.
Here is a link to the wx history page for Reykjavik for Dec 10, 2005....you can get a good idea of what the weather was like by changing the dates.
http://www.weatherunderground.com/hi...q_statename=NA
IMHO, it is worth it to see Reykjavik all decked out for the holidays.