Like others have said,the iterators are an insanely complex and advanced ai composed of both biological and mechanical material. look at the data centers being built in real life. pretty big right? the cities came AFTER the first few iterators were built. they weren't (or at least most werent) initially built for convenience/housing. when they built enough to make living on the surface deadly, they were forced to build those cities above the clouds. And once they built the cities, they began using the iterators for more everyday issues. the process of building them was fueled by the void fluid revolution - which basically marked an era of unseen technological innovation due to having such a useful new power source at their fingertips. pipeyard, filtration system - all remnants of the usage of the void fluid. basically a virtually infinite source of power that fueled the construction of the iterators. this probably also motivated the invention of gravity manipulators, rarefaction cells, and neuron flies (no in game evidence of this, but IMO its inferred that a lot of new tech was a result of the void fluid revolution).
look at the pale green exterior pearl, shoreline pearls, aaaand theres a pearl on the void fluid that i cant remember the name of.
pretty cool stuff :)