Mythical chap to iron in the city (5,2)

I believe the answer is:

santa fe

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'city' is the definition.
(Santa Fe is an example)

'mythical chap to iron' is the wordplay.
'mythical chap' becomes 'santa' (I can't justify this - if you can you should believe this answer much more).
'to iron' becomes 'Fe' (Fe is the chemical symbol for iron).
'santa'+'fe'='SANTA FE'

'in the' is the link.

Can you help me to learn more?

(Other definitions for santa fe that I've seen before include "US state capital" , "Capital city of New Mexico" , "Capital of New Mexico state" , "US city" .)

I've seen this clue in the Sydney Morning Herald.

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