Your iron source could be from one or more of several sources. If your iron pipe has rusted enough to have thin areas, water can be seeping into it, and flowing over rusty surfaces. Also, if your water contacts iron soils, it can come from that. It can also be ground water. I bet your old pipe is the culprit. Since you blocked it, rather than fill or remove it, I'd bet it's providing a vehicle for seepage. So, the iron test does not prove the source is groundwater.
