This sounds like the perfect bike to learn how to wrench on. Park Tools website has a number of helpful videos on common bicycle maintenance and should help some. For some specific things there are youtube videos out there. Beware that they aren't all good, but some are extremely helpful. Get to know how the bike "works". What I mean is, develop a complete understanding of how the braking system works, from the levers all the way to the pads. This will help you diagnose problems if and when they arise. There are fixes for poor braking, excessive noise, braking in wet conditions, etc. Also get familiar with the shifting system. Watch videos on properly setting up derailers for example.
If the frame is showing rust it doesn't mean that it is serious but it does need to be addressed. Post some pictures (more the better) and we'll all chime in on our thoughts. Sometimes a bike needs an oxalic acid bath. This should be followed up by an application of Framesaver to protect the interior of the tubes. A repaint isn't cheap unless you do it yourself. There are a bunch of threads here dealing with DIY paint jobs. Some get remarkable results, but it takes time to achieve a good result. Powder coating is another option. If you wish to replace decals, be aware that they are available. Again, there are threads here dealing with such. I think one provider is called Velocals?
There is a satisfaction that comes with being able to strip a frame down, clean it with care and put it all back together. I hope you give it a shot!