It says here that he was on leave from his NSA job for treatment for his epilepsy (well, that's what he told the NSA). It's been known that medical tourism is somewhat big in Hong Kong (though mostly for other Asians, particularly mainland Chinese). In this respect, going to Iceland would've raised a few NSA eyebrows, and in light of this I think HK was a good choice (of course, I'm sure there are other, better, choices).
Iceland cannot make guarantees either. Also, I suspect that booking a flight would raise a lot of suspicion. Spies spy on spies -- people like Snowden are just as likely, if not more likely, to be watched, than your typical civilian.
