Location is dependent entirely on the weather. There are maps to show the best days and areas to see them, but it's not months in advance. I saw them in Reykjavik in end of November. Iceland is easy to travel around, I wouldn't bother with any tours unless it'd be a flying one or a boat one.

If you're not going off-roading, then driving in Iceland with AWD is painless. Itinerary is going to highly depend on how long you're going. Spring/Summer is going to be best to hike and see the nature. Winter is best for the Northern Lights opportunities.

I had a lot of fun staying mostly local to Reykjavik in the Winter, and traveled more around the country in the Spring.