Oh gee - I don't think we knew Icelandics couldn't gait in a western saddle. Our friends, who own Lina (half sister to our two) all ride western. Lina gaits beautifully with her western tack. I asked the young owner's sister what gait she was doing recently and she answered "tolt". I wasn't sure that was true, except in the generic sense, but she does a nice easy intermediate gait and I doubt the family cares what it actually is.
Nancy