Gralamin is correct. You use your manufactured weapons (including unarmed strike or Monk's flurry of blows) at their normal bonus (including all normal iterative attacks with that weapon), plus any natural attacks that are still eligible (usually bite, tail or gore) at a -5 (secondary) penalty. The Multiattack feat reduces the penalty for secondary natural attacks to -2 (and Improved Multiattack reduces it to 0).
The only ways to get iterative attacks with natural attacks that I am aware of are:
1.) The Rapidstrike and Improved Rapidstrike feats from Draconomicon.
2.) A Druid's animal companion that only has one attack (such as a Wolf) gets one iterative attack at -5 when the druid hits 9th level.
That's up to you, of course, but I wouldn't call a 2nd attack at -5 penalty (and only 1/2 STR bonus to damage) unbalanced at 2nd level. A character with Two Weapon Fighting or Rapidshot can do much the same, if not better.