Iceland in translation is less icy

I read one of Michael Dibdin's Aurelio Zen books, And then you die. Part of the plot (not really a spoiler) involves Zen (an Italian) finding himself unexpectedly in Iceland. The Italian consul, who meets him there, tells him where he is, and they have this exchange (in Italian):

Snæbjörn Guðmundsson: This is Iceland.
Aurelio Zen: I don't see any ice.
Snæbjörn Guðmundsson: No, Greenland's the icy one. 

This is true. Iceland isn't specially icy (not all over it, anyway) and Greenland is very icy. This fact always pleased me.

But Zen is Italian, and does not speak English (he originally believes himself to be in America, where he was bound for, and assumes the people are speaking in some obscure regional dialect of English). The Italian for 'ice' is ghiaccio, though, so the etymology of the Italian name of the country, Islanda, is not obvious as it is in English. It comes as a direct borrowing from the Icelandic name, and the Italian Wikipedia page has to explain this fact, indicating its non-transparency. Similarly, Greenland is Groenlandia in Italian, while 'green' is verde. In Italian, the confusion should never arise.