Is the iron is formed under Earth's crust?

No. the element iron requires the heat and pressure of a sun like ours to be able to form iron atoms. But our Sun did not produce the iron we have. The iron we have on Earth was made in a larger star that went nova.

This iron was amongst the debris field from which coalesced the Earth.

In early times, when oxygen levels were quite low, it is believed that much of the iron would have been dissolved in the oceans and they would have been rather green. After the algae invented photosynthesis, this increased the O2 content of the atmosphere, and the iron was precipitated out as the Banded Iron Deposits, which form much of the important iron deposits worked today.