How would you treat rust on this frame?
A lot depends on how good a paint match you can get and how 'perfect' you want it, or how much you want to keep its originality. For 'perfection' you'd really need to look at respraying but a good job will cost £120-£200.
Personally, I think original paint it worth keeping if at all possible. If you have a dremel with the mini sanding discs they are great for cleaning up rust spots back to bare metal. Then I'd use a rust inhibiting primer with a fine artists brush, then the colour. A light rub with 1200 wet and dry will take care of any brush marks, although a good brush shouldn't leave much. Followed by a T.Cut and wax, if you've got a good colour match it will be invisible from a couple of feet. Some colour's are much easier than others, black is probably easiest. I think yours falls into the more difficult category! Ray Dobbins gives some general ideas on his site:http://www.raydobbins.com/pantografata/ ... ouchup.htm
Just a point which hopefully may be my eyes or an optical illusion on the photo, but does the crossbar have a slight bend in it towards the front?