I can't give any advice on camping in Iceland but there is a campsite on the outskirts of Reykjavik.
A friend of mine tent camped on the east coast of Iceland. His story of watching the snow fall when he was in a thermal pool and it being magical was amazing - then he realised he had to get back to his tent and his clothes through deep snow!! He was ex-army and would often just take off with his backpack and tent. He was some man and a founder member of the Antarctic Swimming Club. Also the first person to wear a kilt in the Antarctic.
Motorhomes are quite a big thing in Iceland. There are many many camp sites with first class facilities, toilets showers cooking facilities to mention a few. 99% have 16amp hookups and only cost 1000kr per person and 500kr if you want power. They also have free WiFi.
Tbh the wild camping thing isn’t a thing once you’re out of the city. As long as your parked out of the way your left alone.
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