Iron man has no business morphing like that

What are you basing this on...? It certainly isn't the comics. So it's just your opinion on something you don't know about? His suits in the comics have done way more crazy things than what we saw in the movie. They didn't just invent that nanotech suit for the movie and it was never seen in the comics before, because his nanotech suit has been in the comics for a while now. In the comics his nanotech suit is even crazier because for one thing, the nanobots are stored inside Tony instead of in the mechanism on his chest that he has in the MCU.

So you're wrong because yes he most certainly does have business doing that according to the people at Marvel who write the Iron Man comics and the people who write the Marvel movies for the Marvel character Iron Man.