I'd go for hardness 10, so it can damage the iron a little more, but I like this generally.
On reflection, I like hardness 10 reduction better too.
I'm also thinking we don't need the "following the normal rules for damaging objects" bit.
Revising...
Razorweed (CR 2?)
Razorweed is a carnivorous aquatic plant that mimics normal aquatic grasses. Only a keen observer will notice the grass blades have razor-keen serrated edges. A patch of razorweed can be quite large, usually ranging from a 15 ft. by 15 ft. square to a field 60-70 feet across (a typical patch of razorweed occupies 8d20 5 ft. squares). Each 5 ft square of razorweed has 25 hit points and can be cut down (AC 16, DR 5/slashing). Razorweed has Spell Resistance 10. Aquatic razorweed always grows underwater, so is immune to fire damage. It requires a DC 20 check against Spot or Knowledge (nature) to recognize a patch of razorweed as a threat.
Every time a creature or object moves into a 5 ft. square occupied by razorweed it takes 1d4 slashing damage. If the victim is bigger than a single 5 ft. square it will take 1d4 slashing damage for every square of its Space that enters the razorgrass. The razor-leaves are incredibly sharp
, ignoring the first 10 points of any hardness a target has. The razorweed continues to inflict damage until all creatures standing on it are dead, have moved away, or the razorweed has been cut down. Razorweed will also do 1d4 slashing damage per round to any equipment worn or carried by creatures standing upon it provided such equipment is within 3 feet of the ground.
Terrestrial Razorweed: There is a variety of razorweed that grows on dry land. This uses the same mechanics as above, except it is tougher (AC 20) and is not immune to fire damage.
