A soft wire brush is probably the most I'd do for a freewheel. If it was a cassette, I might take it off and do a little better job with the brush..... might.

With either, I'd for sure just put some lube on it and go ride.

One could make the argument that the rust will wear out your chain, but probably not much quicker than it already is going to wear out.

If it has to look pretty, then get a new one. I generally keep my eyes to myself and don't look at others cassette's or freewheel's. <grin>