Worldbuilding, by long established usage, antedating Stack Exchange by many years, involves the creation of a fictional world. A place other than precisely our ordinary Earth. Such a query would certainly be outside the scope of WB.SE.
The specific question you pose would be much more suitable over on Mythology & Folklore, as that is the proper SE forum for these kinds of questions stemming from the real world.
A discussion down in the comments I think is pertinent to the nature of this query. AlexP noted incorrectly that queries about fairies are fair game for WB.SE because there are no faeries in the real world, after all. I responded that many things are, in the real world, fictional. They are most certainly phenomena of this real world, and not part of a fictional world and certainly not part of a fictional world as understood for the purposes of this forum.
Thereafter, SRM - Reinstate Monica said Fairies are part of a fictional world. You have now convinced me, unquestionably, this question is germane to WB One can only hope this is an example of hyperbolic logic!
Of course, AlexP and SRM -Reinstate Monica present us with what is plainly a red herring. There also was never a place called Wurthering Heights nor any of the characters that lived there. There also were never places called Pellucidar or Narnia nor Azarians nor Horibs.
Fairies (or any similar race of people or creature) as they exist in the mythology & folklore of real world cultures ought to be approached no differently, from our perspective as worldbuilders, than we'd approach the phenomena of any other fictional place. Fictional places and phenomena that have actual literary existence within the real world are all "third party" works and we don't answer queries about third party works.
Fairies, thus are no different. They are the work of real world story tellers living in real world cultures and making use of real world scientific tools (mythology and folklore are sciences, after all) to create tales of wonder. Whether those tales were first told at a folklore festival in 2019 or whether Grimm recorded them in the 19th century or whether the tale was recorded in an anonymous 14th century source from traditions dating back time out of mind, these places of wonder we call Faerie have their existence in the real world and are thus third party works at best. They certainly are not our works!
The real world is not a fictional world. Hence, the phenomena of the real world -- “hole filling” questions about our world -- are off topic for this Q&A forum. All aspects of real world myth and folklore, as they pertain to real world folklore are phenomena of the real world. A storyteller who is telling a fairy story and encounters the need to explain why Iron is so harmful needs to address her query to M&F.SE, not WB.SE
As we can see from the tour, this forum is dedicated to works of our own imagination, rather than works of others' imaginations: Worldbuilding Stack Exchange is a question and answer site for writers, artists and others using science, geography and culture to construct imaginary worlds and settings. It is not for answering questions about the real world, and that would include all matters of real world myth, legend, folklore and the like.
Even if we wished to go down the irrational path in saying that fairies etc are part of some fictional world, rather than part of the cultural beliefs of the real world, at best those supposed "fictional worlds" would be third party works. As Monica said: This site is for questions about building worlds, not questions about how others' worlds work. Either way, the above proposed query is off-topic for WB.SE!
Since you've gone and argued one side of the correctness of the close vote, I'd posit that the VTC was ill conceived, if for no other reason than that the rationale chosen was incorrect.
You (and the other mods) may not like this query for being opinion based (and I know we could go on and on about what constitutes "opinion based"), but it most definitely is a "how the world functions" question which is spot on topic for WB.SE. While I wouldn't close it for being opinion based, because that's what worldbuilding is founded on, I could at least see that as a valid reason for closure.
Also, the OP edited his query, narrowing it down a bit and offering criteria for good answers. The question is now correctly in the re-open queue.