> Má það sjá að nær standa vinir Gunnars
> (One?) may see that Gunnar's friends stand close by

Yes, the verb 'sjá' "to see" can also be used impersonally, as here:
"it can be seen that..."

> eg þykist þó mjög neyddur til hafa verið
> ...distressed

'neyddr', past participle of 'neyða' "to force/compel". Literally: "I
think that I was much compelled" -- i.e. much provoked; he was driven
to it. He's saying he didn't have a lot of choice but to act the way
he did.

> og mun sá verða málahluti
> vor bestur

> our? best (option is?)

Or perhaps: "the best we can hope for", "the best outcome for us would
be if..." Zoega 'málahluti' (='málahlutr') "one side of a case, one's
share in a case" -- ok mun sá verða málahluti várr beztr, at... "the
best turn for us that things can take will be that..."; MM & HP "our
best hope of a favorable outcome is..."

Fritzner cites this examples under 'málahluti' and redirects to:
málahlutr, m. 1) hvad der som Resultat af Tingenes Gang falder i ens
Lod; ek á þenna málahlut at sinni dvs. dette falder nu i min Lod,
Alex. 11324; þá ferr ílla málahlutrinn várr, ef vandræðin aukast
Ljósv. 2760; kann vera, at ek hafi ekki vit at sjá málahlut til handa
mér Sturl. I, 8415 fg. 2) Sagens Stilling eller Beskaffenhed for den
ene af to stridende Parter (jvf málaefni); varð undan at láta fyrir
því, at bæði var, at hann þótti þyngra málahlut eiga at flytja, enda
varð hann aflvani fyrir liðs sakir Hænsn. 14 (17211 fg).

1) What falls to one as one's lot as the result of the proceedings of
the court; ek á þenna málahlut at sinni i.e. this falls now to me as
my lot; 2) = málaefni. The situation/circumstances or nature of the
case for one of the disputants.

> kvongaður

It just means "married" (to a woman). The older spelling is 'kvángaðr'.

LN