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The one commonly used criteria to withhold extradition is the possibility that the country to which the individual is being extradited would subject that individual to torture or other cruel and unusual treatment.  I don't believe that Fischer would be subject to that kind of treatment, although the US has demonstrated recently that it is not as opposed to the application of torture as one might like.  A ten year prison term may well seem unduly harsh but I don't believe it meets the standards of cruel and unusual punishment.

So, is there any compelling reason for Iceland (or Japan for that matter) to refuse to extradite Fischer to the US, to let him answer for the consequences of his actions under the laws of his own nation?  Remember, the question is not what punishment Fischer should receive; the question is whether there is a valid reason why an American citizen should not be answerable to American laws.

It is also worth noting that just a month before the 1992 chess tournament, another U.S. citizen, former ICN Chairman and CEO Milan Panic, went to Belgrade to become the country's Prime Minister under Milosevic's presidency -- and Washington did not object. So Washington said it was okay to join Milosevic in Yugoslavia as Prime Minister during a time of genocide... but not to play chess there.

Now that isn't really fair.  First, Panic became Prime Minister of what was left of Yugoslavia while Milosovic was President of Serbia, still a part of Yugoslavia.  Second, Panic was an enemy of Milosovic who sought to remove him.  It seems that Panic also tried to defuse and avoid the ethnic conflicts.

Here us an interesting link: Kosovo: The Long Road to War

Sorry to reply twice :)

It is worth noting that there is no constitutional law or statute that explicitly permits presidential executive orders -- presidents have often been accused of abusing them, and courts have twice overturned them.

While it is true that the some presidents have abused Executive Orders, in this case Bush was wielding a power explicitly given to him by Congress in Title 50 of the US Code, sections 1701..

1701(a)Any authority granted to the President by section 1702 of this title may be exercised to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States, if the President declares a national emergency with respect to such threat.

1702(a)  In general

(1) At the times and to the extent specified in section 1701 of this title, the President may, under such regulations as he may prescribe, by means of instructions, licenses, or otherwise--

(A) investigate, regulate, or prohibit--

(i) any transactions in foreign exchange,

(ii) transfers of credit or payments between, by, through, or to any banking institution, to the extent that such transfers or payments involve any interest of any foreign country or a national thereof,

(iii) the importing or exporting of currency or securities,
by any person, or with respect to any property, subject to the jurisdiction of the United States;

B) investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States; and...

The theory that the executive order was somehow invalid or an abuse of power does not hold water.  Congress has granted the president the power to grant a state of emergency to deal with the threats to the foreign policy of the United States.  Furthermore, in such an emergency the President has been granted by congress the power to prohibit economic transactions with a foreign power.