We spent two nights in Isafjordur, and enjoyed our accommodations at the Hotel Isafjordur. There are actually four locations managed by the same company, and they call them all Hotel Isafjordur, with secondary names to distinguish them. We stayed at the main location (nicknamed Hotel Torg on their website) which is right in the center of town, across from the harbor. There is a restaurant on the ground level, with sweeping views of the water and hills. We didn't try the restaurant for lunch or dinner, but the breakfast buffet was quite good, and included with our stay. Rooms are on the smallish side, but very comfortable. The sole elevator was cramped. But really, the most important thing is location, and this really is close to everything. A good value for your time in the westfjords.