Improving insulation on windows and preventing heat loss
Ice forms in that location because 1) heat is lost where the two panes of glass are connected by the metal frame, and 2) cold air sinks to the bottom of the window opening. I don't see any red flags that indicate air leakage or other serious issues. The fact that the entire glass pane frosts up at times reinforces that position. You have simple heat conduction happening, with little or no air movement from exterior to interior. 

I've lived in Minnesota for 25 years, and what you see there is nearly unavoidable in extremely cold weather. It's a result of heat loss through the window and excess moisture inside, and it's the reason window film was invented. I realize that the idea of applying film annually isn't terribly appealing, but it's probably your best bet here, short of replacing the windows. Only low-e glass panels and ultra-modern sealing and insulation, coupled with very good indoor humidity management, will completely prevent ice formation.