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Drive vs. Fly?

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Hi. I am planning to go to Iceland in early July 2007. Staying a fews days each in Reykjavik, Akureyri and Hofn.

Domestic airfare for 2 people is quite expensive between the capitol and Akureyri and the capitol and Hofn. So, I am debating whether or not to just drive to each of these places.

Has anyone here driven the routes from Reykjavik to Akureyri, Akureyri to Hofn, or Hofn to Reykjavik? How long did it take and was the scenery worth the time it took to drive vs. fly? I see that its approx. 300 miles between each place.

Also, any suggestions on the best rental car company there for convenience, customer service, quality of car and price. Hertz, Avis, another?

Thank you for your help. Much appreciated.

Derek

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