Here’s my translation

Season’s greetings to all. I will be away until 10 January.

Alan

Grímur mælti: "Nú hefir öðruvís orðið en þú mundir ætlað hafa því að nú mun
Grímr spoke: „Now (it) has happened otherwise than you would have expected because now will

þitt líf vera á mínu valdi."
your life be in my power.”

Þorkell kvaðst ekki mundu sér friðar biðja "því að mér hefir ógiftulega tekist."
Þorkell declared-of-himself (that he) would not sue for peace (beg for mercy) “because (it) has happened to me haplessly.”

Grímur sagði ærin sín óhöpp þótt þetta liði undan: "Mun þér annarra forlaga auðið verða
Grímr said his (ie his own) misfortunes (úhapp) (were) sufficient (oerinn) even-though this should-pass by (líða undan, Z6 impers, typo for líði?) (ie even without taking this event into account). “For you (it) will be destined of another fate (ie another fate awaits you)

en deyja á okkrum fundi og vil eg þér líf gefa en þú launa því sem þú vilt."
than to die at our meeting and I will give (your) life to you (ie spare your life) but you (will) reward (me) with that which you want (ie however you like).”

Standa þeir nú upp báðir og ganga heim til skálans. Þorkell sér að
They both now stand up and walk home (back) to the-hut. Þorkell sees in Grímr

Grím mæðir blóðrás, tekur þá Sköfnungsstein og ríður og bindur við hönd Gríms og
blood-loss wearies (moeða) Grímr, takes then Sköfnungr’s-stone and rubs and fastens (it) to Grimr´s arm and

tók þegar allan sviða og þrota úr sárinu.
(it) took at-once all (the) sting and swelling out-of the-wound.

Þeir voru þar um nóttina. Um morguninn býst Þorkell í brott og spyr ef
They were (stayed) there during the-night. The-next-morning Þorkell readies-himself (to go) away and asks if

Grímur vilji fara með honum. Hann kveðst það að vísu vilja. Þorkell snýr
Grímr wants to go with him. He declared-of-himself to certainly want that. Þorkell turns (goes)

þegar vestur og kemur ekki á fund Eiðs, léttir ekki fyrr en hann kemur í
at-once west and comes not to a meeting of Eiðr (ie he doesn´t see Eiðr), stops not before he comes into

Sælingsdalstungu. Snorri goði fagnar honum með mikilli blíðu. Þorkell sagði
Sælingsdalstunga. Snorri goði (chieftain-priest) greets him with great friendliness. Þorkell said

honum að ferð sjá hafði illa tekist.
to him that this journey had turned-out badly.

Snorri kvað hafa vel orðið. "Líst mér giftusamlega á Grím. Vil eg og," segir
Snorri declared (it) to have panned-out well. “(It) seems to me auspiciously on Grímr (Luck seems to accompany Grímr). I also want,” says

hann, "að þú leysir hann vel af hendi. Væri það nú mitt ráð vinur að þú
he “that you do well by him (cf on (his) behalf, see af hendi, under hönd?). That would-be now my advice, friend, that you

létir af ferðum og fengir þér staðfestu og ráðakost og gerist höfðingi sem
should-leave-off journeys (trading voyages) and get for yourself a fixed-abode and a marriage and become a local-chieftain as

þú átt kyn til."
you are-entitled (by) kin (extraction) to.”

Þorkell svarar: "Oft hafa mér vel gefist yður ráð" og spurði ef hann hefði
Þorkell answers: “Often have your counsels (plural) proven (gefast, Z8) good to me,” and asked if he had

um hugsað hverrar konu hann skyldi biðja.
given-thought to which woman he should ask (in marriage).”

Snorri svarar: "Þeirrar skaltu konu biðja er bestur kostur er en það er
Snorri answers: “You-shall ask for (in marriage) that woman who is (the) best match and that is

Guðrún Ósvífursdóttir."
Guðrún Ósvifr’s-daughter.”

Þorkell kvað það satt vera að ráðahagurinn var virðulegur
Þorkell declared that to be true that the-marriage was worthy

"en mikið þykir mér á liggja ofstæki hennar," segir hann, "og stórræði. Hún mun vilja
“but her ferocity seems to oppress me (see liggja á e-m, Z8) greatly,” says he, ‘and ambition . She will want to

hefna láta Bolla bónda síns. Þar þykist í ráðum vera með henni Þorgils Hölluson og
cause to avenge Bolli, her husband. (I) would-bethink there (in that regard) (it) to be in counsels between her and Þorgils Halla’s-son (ie they are devising something together)  and

má vera að honum sé eigi allur getnaður að þessu. En vel er mér Guðrún að skapi."
(it) may be that everything would-not-be a liking (ie agreeable, getnaðr, Z3) to him about this. But Guðrún is to my mind (liking).”

Snorri mælti: "Eg mun í því bindast að þér mun ekki mein verða að Þorgísli
Snorri spoke: “I will engage-myself to that, that to you (there) will not be harm from Þorgíls

en meiri von þykir mér að nokkur umskipti séu orðin um hefndina Bolla áður
but a greater expectation seems to me that some change would-be brought-about concerning the-revenge of Bolli before

þessi misseri séu liðin."
this half-year (season) be passed.”