Asked about Ronaldo's post-match reaction, Santos played down reports the 31-year-old had failed to acknowledge the opposition.
"I didn't see that at all. I was watching the players," he told a news conference.
"He greeted the Portuguese crowd – that was amazing. We wanted to give our crowd a win, they supported all through the match.
"That's not what I saw. I don't think that's true at all."
Nani had given Portugal a 31st-minute lead, but Birkir Bjarnason levelled for Iceland early in the second half as they earned a point in the Group F clash.
Santos rued his side's missed chances and said there was no chance of underestimating Iceland, who are at their first major tournament.
"We should have scored more goals – there's no secret about that. We weren't surprised by Iceland because we were familiar with their team," he said.
Santos added: "We started off OK in the second half then there was this move. We knew they could do this, start playing long balls to full-backs who crossed well.
"Iceland played a pragmatic type of game. We fought back well after the goal, we were shaken a bit but fought well and had chances to win.
"In the end Iceland had another dangerous shot, in between we had three or four chances. We are to blame for not scoring.
"Final 10 minutes we were anxious and should have been more patient and tried to score with cooler heads, be more patient in selecting opportunities.
"We're disappointed not to win the match. We believe we can go through. Our aim is to win on Saturday [against Austria]."