That **** is thoroughly rusty, isn't it? Worth about $1. The wheel... even over here, where people don't throw away good stuff that much, you can get better ones from dumpsters.

However, I say go for it if you're broke and you want a working fix (make sure that rear wheel is gonna hold up...) Keep in mind that it is not bombproof and keep the brakes on. Look up rotafixa and tighten the cog down as hard as you can. Possibly throw in some threadlocking stuff and a BB lockring. Don't buy that rusty old cog, get whatever else you can find cheap.

Oh, and Sheldon Brown uses quick release. You need a decent QR and tighten it down like crazy but he says it works just fine.