Mal Malenkirk said:
Actually, that's old french. "Hammer" translates to Marteau in modern french.
Martel is almost out of use as a noun. It survives only in an old expression that means "to worry" (se faire du martel) that few still remember.
But then this is D&D so I guess using old french kinda makes sense. You won't see many francophone use it, though. Too weird.
Martel de fer is even worse. It litteraly translates to Iron Hammer! Maybe it's a term that was used a few centuries back, I wouldn't know. I just know that today it sounds really silly. The translation for warhammer is Marteau de Guerre and that's the term most french speaking D&D player will use.
Martel "Hammer or Mallet" is from Frankish (maybe even gaulish 7th centuryish at least) before the time of even the Holy Roman Empire and Charlemagne.
Then there are is hache de fer, pioche de fer, epee de fer, baton de fer and arme de fer, at any rate your probably right about fer meaning iron (Mon Francais etant pauvre).
But a "Martel de fer" was a weapon from the old times to 16th centry.
How the name was what it was, no one may ever know, I sure don't.

It was pretty rare for the most part, axes being much better for a lot of reasons, maces too, and flails (well you get the picture).
Historiclly hammers have never really been that importent or even that great a weapon, just like the "Lucern Hammer".
They were fairly easy to use and could hurt a person in armor though.
But it was called the "Martel de fer" for a very long time, an it's name did mean Warhammer.
Even now if your talking to someone about old weapons and you say "Martel de fer" they know your talking about an old northern european warhammer.
But then again it's a game, and game designers tend to look for odd obscure names, even if they are going to use them incorrectly.
Some of my DnD friends play Everquest and I watch them from time to time, anyway there is this weird crasy looking two bladed weapon in the game, so I asked them, "What's that?"
Then acting like I should know he said, "It's a knuckle duster."
That weren't no real knuckle duster. (Don't even get me started on what they call a "lamentation")
Where do they come up with this stuff, the real things are far more intresting.