How much of a concern is rust INSIDE of a frame? When disassembling one to take to the powder coater, I noticed quite a bit in the top tube. The downtube (at least what I can see) and bottom bracket don't particularly worry me, and the seat tube looks easy enough to clean up with a shotgun brush and some oil, but the top tube is worrysome, a) because I don't have any sort of borescope to see how extensive the damage is, and b) because the rust is bright orange and appears there may be moisture in there. I don't really want to spend money on a powder coat job if this is something that is going to ruin the frame in the next couple years.

I tried to get a picture to exhibit my concern. I should say this is only a concern on the front of the top tube, the back by the seat tube looks pretty dry and just a light surface rust inside.

If the outside of the frame is in good shape I don't think I would worry. Some oxidation on the inside of the tubes is natural. I think that might prompt me to treat with frame saver or boiled linseed though.

That headset cup looks jacked however.

Rust on the inside of a frame can be a concern, but so long as the frame's in good structural shape right now, it's treatable. An oxalic acid bath would take care of that internal rust. Pick up a 12 oz. tub of "wood bleach" (oxalic acid) crystals from your local hardware store, mix it with a kiddie pool full of water, and submerge the frame overnight. Remove the frame, rinse very well inside and out, and dry.

After you get the frame back from the powder coater, consider treating the inside of the frame with a rust inhibitor like J.P. Weigle's Frame Saver, Boeshield, or Boiled Linseed Oil. My personal go-to is AMSOil Heavy Duty Metal Protector, which is supposedly the same stuff as J.P. Weigle's, but I can buy it at my local auto parts store.

I keep reading about using frame saver or linseed oil to prevent internal rust. Why not just paint the inside with a good rust preventative primer?

My guess would be that liquids penetrate and get all over the inside much easier. Painting the inside would presumably have to be something done at the factory, before the frame was assembled?

How so?

At about 1 o'clock, what looks to be a big gash in the race. Maybe just a picture illusion.

Yeah, I think it was just a glob of grease. Can't get an awesome pic with my phone, but I don't see any significant gashes