Is Iframe based payment gateway integration with civicrm possible?
I don't think it's easy. I have tried without success a couple years ago. 
The return page will go to the iframe rather than the parent page and i didn't find a way to close the iframe and having the Thank you page on the parent page.

I know that there is a lot of work that is being done lately regarding payment refactoring but i don't know if it tackle this kind of problem.