Being an engineer of course I had to check your math, slightly off I think.
I read that Iwo Jima is 8 square miles, and that equates to 24,780,800 square yards.
So, if there were approximately 25,000 combined killed on the island, that would be one body for every 100 square yards.
Still though, when you think about it. Create a grid over that entire island, 10 yards by 10 yards, and you could place one soul in each.
8 square miles seems close enough. I think they estimate Japanese casualties at about 26,000 killed, so grand total would be 33,000 or so. Still not enough to cover your 24 million square yards. I heard that from my MEU CO during a visit to the island. Perhaps I remembered it incorrectly.