If the conflict between Bronze and Iron Age cultures were represented in fairy folklore, one might expect fairies to be characterized as wielding bronze weapons, rather than the flint ‘elf-shot’ they are traditionally held to use.
The highlighted part seems to offer a pretty reasonable hypothesis for antipathy to iron among the fey folk.
“What the hell are all these pointy things we keep plowing up in the fields all the time? They look like spearpoints and arrowheads, but they’re made of stone instead of iron!”
“Ah, but no mortal man would prefer to make weapons out of stone rather than iron. Therefore, some otherworldly beings must be responsible. But why would they make their weapons out of stone instead of iron? Clearly, these otherworldly beings don’t like iron for some reason…”
“But, Conán… couldn’t these arrowheads have been made by some other race of humans, perhaps long ago, when they didn’t know how to craft iron weapons?”
“Don’t be ridiculous, Óceallaigh. We’re as ignorant as it’s possible to be, and even we know how to make iron. No, once you have eliminated the impossible, whatever remains, no matter how improbable, must be the truth. Obviously, these weapons were crafted by a race of invisible nonhuman beings with an allergy to iron.”