It's on both MU and Wordpress, but I think the problem is in the form used to post. If you use the visual editor to post, then the iframe code is converted to this: <iframe src="http://google.com"></iframe>
...and the iframe will not be live on the site.
If you don't use the visual editor in the admin panel, or if you just use a regular form, then the iframe code is not converted and the iframe will be live. So, is wordpress's solution to just use the visual text editor? I hope not. Please offer any suggestions, because I want to allow others to post new topics, but just using a simple form that I am already using (without access to the admin panel, and without their posts being pinged, etc).