Looks like you have some rust issues to deal with prior to building up this frame. I would suggest you inspect the bottom bracket area (internal) as well as the seat tube internally for rust. If you have significant rust there, do a search for oxalic acid. There are lots of threads on rust treatment. I am treating six frames myself right now (cheaper and more efficient to do it campaign style, treatment costs the same (I reuse all materials), so by doing six bikes, the cost per bike is 1/6 as much.