Some more work on it, sadly I haven't had as much free time as I would have liked.
Laying out the main roads, the wider, grander, semi planned roads that are wide enough for several wagons to travel either way at a time. I ended up settling on about 10 feet per pixel on the 2000x2000 map, and I haven't finished calculating the final probable population yet.
The settlement started near the Old Keep on the North-West bank of the river, and after an initial growth there, another village was founded on the island, with a stone keep raised near Iron Town Castle. This area was soon walled in, and because the island had limited wood, most building is stone.
This second keep was rebuilt several times, and the small village spilled out onto the rest of the island, a second and third keep were built at where the light houses now stand. I'm debating if I want to put an old wall around the central fair/market in Town Proper.
About 100 years after the island villages were founded, the trade in Iron began. Upriver, mine and logging camps would ship iron ore and charcoal south, and the original Iron Works was founded across the river on the flatter ground that had better access to wood. This area was soon walled in, and became a filthy mass of men, iron, wood and stone. (You can see the path the wall will take around the central Ironworks, the end of the wider, more open road ways to allow for larger yards for the smelters and smithing.)
The island towns grew, and soon the whole area was built up, and becoming over crowded. At this time the already over crowded laborer's homes/apartments right next to the ironworks they labored in of course burned down. This prompted the newly self crowned king to order a larger, more defensive wall to be built around the Ironworks on a small curving hill, and that the old ironworks walls define an area that ONLY master smiths and smelters could build shops, and that none could actually live within the walls. Offering a great deal of wealth to any smith that came to Irontown with 3 or more apprentices, the city was soon rebuilt, and trade boomed even more. The North and South keeps were raised more and acted as light houses, and a large bridge was built across the narrows at the north. (not sure if I want to build any in the south, or just use ferries. That is after all, not a narrow bit of river.)
The city is one of the best guarded in the world, with a militia of every able bodied male that is considered grown by his race's standards is outfitted with some of the finest arms and armour in the world. Master smith's are taxed at 1/10th their coin a month, or two of their finest creations a year. They are also required to keep on hand a stock of weapons and armour for the city militia in a time of war. Traders are also taxed 1/10th of their weapons or armour they leave the city with.
The great protection from the mundane has also attracted a small community of arcane magic users from the region. Drawn there by the safety offered by the walls, they further enhanced some of the defenses, and are often pay taxes by way of enchanting weapons for the city's defense.
This has left Irontown one of the few cities in the world that has almost every common city guard carrying Master Work arms and armour, and nearly 1 in 10 is likely to have one with some minor enchantment.
I'm planning to have the old town and keep basically abandoned. Destroyed shortly after the fire gutted the first Ironworks by the king's slightly mad son, who was obsessed with spiders. I'm thinking of doing a large dungeon under it, with a minor Lich or something that likes to toy with adventurers, and no and then send infestations of common spiders across the river for one night every year or so.