Thank you for the patch. But ...
1. After a look at two unofficial web sites:
"Concise dictionary of old Icelandic"
http://www.northvegr.org/zoega/index002.php
"Old Norse Online"
http://www.utexas.edu/cola/centers/lrc/eieol/norol-1-X.html#Nor01_GP01
It appears that not everyone agrees about
the relative positions of œ ø and o-with-ogonek-and-macron.
2. MySQL's intent is to support "modern Icelandic".
3. People who already have a database containing these characters
will have to rebuild indexes to prevent search errors.
If there is an official Icelandic standards body with a published
statement saying what must occur for "Icelandic", then I hope you
will submit it and your patch (which appears well made) to MySQL's
bugs-reporting site, bugs.mysql.com. Failure to support Icelandic
standards would probably be regarded as a bug.
Peter Gulutzan
MySQL AB