Since the general concensus is to fix it up, I'll add a few more questions to the mix.

What kind of grease for the bearings? Can I use standard Hi-temp car wheel bearing grease? I've got plenty of this at home.

Any special paint? I'll probably strip it all the way down to the frame and work back up from there. Can I use spray paint or do I need to go the route of air compressor / spray gun, which I also happen to own.

Thanks for the info on "step-through" I'll be able to use that when I get teased for riding a girl's bike.

PH