Thanks for the reply.
I have attached another pic (sorry, i need to get on a ladder to get the pics, and most are ending up out of focus). This pic shows there is a flange (or bolt) attached to a copper pipe. On the other side is the iron pipe which is attached to this flange via another iron ring which is rusted badly. The pipe goes into the attic possibly or may also be going down through the wall (its on the garage side). The iron pipe is feeding into the hot water heater and the rest of the pipes are copper; my guess is that this is coming from the main water supply (those parts are iron ), and the rest are copper inside the house.
Thanks again for any opinions!