The best way I have used to reproduce rusted items id to prime the part with black, drybrush with white, wash all with a sepia ink (also the GW Chestnut ink work well)
When the ink is dry I will add a light drybrush using Vallejo Light Orange.
You can see the results browsing the images 8208, 3730 or looking in my site, I have painted all the Rackham Mid-Nor dwarfs for a client in this way
http://www.minitaly.com/~dp/pic/index.php?cat=3_-_My_miniatures&gal=Rackham_Mid-nor
Paolo