.IS nameserver setup can be a bit tricky since the ISNIC registry has strict requirements for nameservers, but they don't really provide much information about them, particularly when an update attempt fails.
You can test your domain and nameservers you're trying to update to here: Check domain setup.
Once you resolve any issues shown there, or get assistance from your web hosting provider to do so, you shouldn't have any trouble completing the update in your iwantmyname dashboard.
If you have any questions or need further help, just let us know.