Iodine turns blue/black in the presence of starch. Not sure why it happened in your cooler-- did you have any grains or grain dust in the water? Or maybe the cheesecloth had some starches in it?
Anyway, you don't need to sanitize any of your AG equipment before the boil, because as Warped04 said, it all gets sanitized during the boil.
On Deck: Jamil's Vanilla Robust Porter
Fermenting: Orange Blossom Mead
Kegs: Element 56 Pale Ale, Ron's Belgian Blonde, Summer'n Saison, Furloughktoberfest '09, Grateful Pale Ale, Sam Adams Cream Stout Clone, EdWort's Apfelwein