I dug up 'Zesting Lemons'... Same stunted growth and collapsed roots.
I probably have Iris Scorch.. Thanks Arlyn for diagnosing for me. It's a bacterial disease that happens when the weather gives ideal conditions. Yesterday, I took out the soil, poured a bleach solution in the holes.. I sprayed all the Iris and the surrounding soil with Serenade... (Might help, can't hurt..) Today, I followed up with a little torching in the holes and surrounding area, as heat will kill the bacteria.
Here are some articles that Arlyn so graciously sent, that I feel should be shared. I'd never heard of this before.
http://www.herbs2000.com/flowe...
http://www.chapmaniris.com/id3...
http://ucce.ucdavis.edu/files/......
http://wiki.irises.org/bin/vie......