Mark,
Well, two things come to mind. And keep in mind, I am not an expert, but I'll gladly share my experience and whatever I know...
Iron can stay in the water when flowing. It will settle out after sitting, but seldom settles like sediment, just "comes out". Chlorine brings dissolved iron out of solution, so shocking it makes it easy to filter, but brings out the hidden red stuff.
If your casing is rusted, not much to do. You can probably stop the rust from getting any worse by using a sacrificial rod. You put this in the ground and attach it by a wire to the top of the well casing. Make a good connection, just like for electricity.
This method was often used for buried steel fuel tanks years ago. The rod eats away, the tank remains pristine /forums/images/graemlins/cool.gif
There was a post on this board where Biron posted this link
Galvanic Scale , which shows what metals to use to be sacrificial to which metals (in this case, find one above Steel, like Aluminum).
I was going to try the rust removal process shown here
Rust removal... on a portable gas tank by hanging a sacrificial rod down the center, being sure not to touch the sides and running the battery charger. Wonder if that will help "seal" the rust out of your casing...?
Take a look at the link, and maybe some of those who posted can offer more opinions here. Let me know what they say...
Should work, though.
A water softener like a Water Boss (Lowes, about $600) with Red Out salt (softens, but made for iron) can help, if you don't mind filling it yourself with salt every few weeks and don't drain it into your septic.- Someone just mentioned using salt to kill weeds, maybe a good use for this drain water? /forums/images/graemlins/smirk.gif
Good luck with it and let us know what you do how you make out.
-JC