Delete key does not always work in IRAF's xgterm on Mac
This sounds like a problem with your terminal settings.  Quoting the Setting up IRAF section this page, "We assume the user has defined this correctly when issuing the MKIRAF and no longer key off the unix TERM to set a default."  The page goes on to say that one should add stty xgterm the to your login.cl file (directly above the final keep line might be a good place).  The page linked above goes into more detail.