Chuck4,
A rather trivial point considering the two things have very little to do with each other. It's like saying, "well 2 of the 3 nations that have put men/women into space were communist, if we have a communist government, we can do it too!" While Iran doesn't have much a true traditional aerospace industry, they have an EXTENSIVE ballistic missile industry (including in both liquid and solid fuel rocket/missile designs), and a fair amount of financial support, which is exactly what you need for a proper space program.
Just look at their current space program. The Safir SLV is a relatively simple design: two liquid-fuel stages, the 1st based on the Shahab-3/NoDong and the 2nd stage of their own design. Yet, this simple design has been MUCH more successful than North Korea's much larger Unha SLVs. The fact the Simorgh is taking a bit longer for its first test launch than expected is likely because Iran wants to be sure not to repeat the failures North Korea encountered when they first tested the Taepodong-2/Unha years ago. While the two nations use some the same technology in their SLVs, the differences between Iran and North Korea's space programs is quite stark. Instead of going straight to a larger, more complicated design for their first SLV, Iran chose a simpler and safer design and it paid off with 3 successful launches in 3 years, instead of the abysmal results of North Korea's efforts.
When it comes to the plans for a suborbital launch...IMHO they have the technical ability to do so, though their deadline (2018-2020) might be a bit overly ambitious. Since suborbital launches require much smaller SLVs than orbital launches and from the information I have see on the subject (several "think tanks" have looked into the idea), the Simorgh would be a fine basis for a suborbital launch vehicle. For manned orbital launches though, will require a larger SLV altogether..Which Iranian officials have already hinted at there being a larger SLV in the works. When it comes to what Iran's suborbital and orbital manned launched vehicles COULD look like, I strong suggest a visit to GlobalSecurity.org's page on the subject. Here are few sketches they have on the subject: