My usual advise is to just get the thing running and ride it around a bit. It'll tell you what you should do to it. That and you'll know if you really like riding it before you go and do a full restoration.
+1 to sailorben... comment. Make it an ongoing project as much as possible. Equip it with workable components and ride it as much as possible.
Cheers,
Van
__________________
Remember: Real bikes have pedals.
...and never put a yellow tail on a Red, White and Blue kite!