How useful would an iron currency like Braavos’ actually be? If a major use of currency is to be a constant store of value (i.e. gold doesn’t decay), wouldn’t iron’s high oxidation rate make it a really bad medium through which a financial powerhouse does business?

Well, I wouldn’t look to the metallic content of a coin as a guarantee of the store of value – gold can be clipped, sweated, plated, etc. etc. Iron’s historic disutility as a currency has as much to do with the fact that iron coins are heavy as the fact that they rust. (For example, copper and bronze also rust, but have been used as currency for a long time.)

As for Braavos, I think people over-generalize from that one quote from ADWD. That Braavos has one denomination of coin made out of iron does not mean that they only use iron currency – for example, WOIAF states that “In Braavos, as many an outsider has observed, golden coins count for more than iron keys.”