In my younger less knowledgeable years I worked in a retail store and came accross many old bills. I saved alot of them but some I soaked and then ironed.
My experience and information gathered from CoinTalk and other currency forums tells me that both practices are frowned upon. You can probably kiss any *PQ designation goodbye for ironed notes. Most currency collectors prefer "original" paper quality, like embossing, and natural paper waves....but to each their own.
Ironing stretches the paper fibers and as Steve says doing so will likely eliminate certain chances of grading in a particular designation. Once paper has folds they are pretty much permanent and should just be left alone. Any steam involved in ironing notes works to eliminate, or at least alter, the paper surface, which has a delicate layer of sizing, a glue like treatment on the papers surface that helps printing and the quality of the finish. This surface is often noticeable on GEM notes as a thin smooth sheen and easily damaged, effecting grades. Ironing certainly affects the sizing as the heat reactivates and destroys this delicate surface feature. I believe that people feel ironing will return a note to its crisp nature and restore it's eye appeal, but that is only something that can be had with a freshly printed pristine never circulated note. It's the result of methodical intaglio printing processes and not something that can be faked and recreated, which helps to establish a standard for grading and authenticity.
ironing or pressing any note will bring the value/grade down especially ironing because In will generally darken the note making it less desirable!
Good point! I believe that while a note that has been ironed will not always show the effects immediately, over time, the paper may become darker (more tanned) and less desirable as mentioned. Sometimes the affects of artificial alteration/manipulation are not immediately evident but overtime become more so.
