The visitors made a bright start and leading scorer Martin Paterson went close with nine minutes on the clock, but Palace goalkeeper Julian Speroni made a fine block from close range.
The Eagles hit the front with 21 minutes on the clock, with midfielder Tom Soares getting on the scoresheet for the third time in five games.
Loanee Scott Sinclair fed teenager Victor Moses on the left flank and his cross into the area was converted at the far post by the arriving Soares.
Moses continued to look lively and went close with two strikes from distances, before Jonathan Forte headed over from an Ian Morris cross as the Iron went close to an equaliser.
However, they fell 2-0 behind six minutes before the interval as the impressive Moses was again the provider, with his ball in from the left being headed home by the unmarked Clinton Morrison.
After the restart the visitors pushed forward with their Championship survival on the line, but Andy Butler's header was the closest they came pulling a goal back.
Just past the hour Iron boss Nigel Adkins threw on striker Paul Hayes as Scunthorpe went for broke, but it was Palace who almost added a third goal.
Sinclair fired a shot over the crossbar from 12 yards as Scunthorpe were caught out on the counter-attack and shortly afterwards Morrison lifted an effort over the top from close-range.
Forte and Curtis Weston came close to securing a late consolation for the visitors, but the final whistle confirmed that they will play in League One next season.
Meanwhile, Palace are dreaming of a return to the top-flight as their play-off charge was boosted further.