Grindavik is where we stayed when we went to Iceland a few years ago - not much going on there but it was a lot cheaper than Reykjavik. And it was a lovely hotel we stayed in.
On the first evening we arrived, we had supper of the most amazing lobster soup in a bar by the harbour. It was the only place open we could find, and the only thing they had on the menu, but we couldn’t have asked for better.