Sometimes you come across a really good explanation for why something is the way it is in a given campaign setting. On the subject of flying machines in the Iron Kingdoms, we are given further evidence that the Privateer Press writers know what they’re doing:
This question comes up a lot. There are a few hot air balloons in the Iron Kingdoms, mostly as a toy for the very wealthy. You can only go up and down in them. They aren’t dirigible. When Vinter Raelthorne made his escape in a hot air balloon, he went into the Bloodstone Marches because that is where the wind took him. He certainly didn’t want to go there (but it worked out to his advantage when he did).
One out of game reason why there aren’t any aircraft in the IK is lighter-than-air dirigibles and sleek and aerodynamic aerostats go against the heavy, bulky, ironclad imagery that forms the core of the Iron Kingdoms setting. Another out of game reason is that it makes rapid transportation possible outside of preset travel routes. If you want to get from Caspia to Corvis in a hurry in the current setting, you take the train to Bainsmarket (passing through Steelwater Flats and Fharin and many other little towns on the way) and then cut through a pass in the Dragonspine Peaks (passing the Tomb of Lost Souls on the way) to the river and then take a boat down stream to Corvis. With an airplane, you would take off from Caspia and land in Corvis and totally avoid any interesting scenery or encounters. Airplanes pretty much negate geography.
An in-game reason for the lack of aircraft is that no one has developed any. No one wants to break the surly bonds of earth and touch the face of god when that god is Lord Toruk or one of his children. In the real world, we only have to worry about hitting a flock of geese or something. In the Iron Kingdoms, there are big flying monsters who will have the home field advantage. An early airplane would be completely out maneuvered and outclassed by any flying creature. And most flying monsters are predatory and would likely attack a flying intruder into their domain.