Suppose that one of the reasons Iron is anathema to Fey is because it is an "alien" metal to them, found only on Earth, and not to be found anywhere in the Fey Wilds. Like a "kryptonite".
There are interesting thought experiments about what a society would look like without iron being common and cheap, e.g., https://worldbuilding.stackexchange.com/questions/96218/are-there-any-good-alternates-to-iron
In the Realms, players make do with what they have and in small scale, so it's not as severe an upheaval and would just be a feature that sets Nightingale apart in terms of world design.
And once cut off from earth / nightingale, any iron remaining in anything would be extremely valuable as anti-fey in various applications. The folkloric traits of iron could be emphasized. E.g., https://en.m.wikipedia.org/wiki/Iron_in_folklore
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