I've seen cars in much worse shape come back, my rust issues are nearly completely confined to the rear wheel wells with a small among of surface rust in a few small spots.
Here's the process that I will be using to repair the area, as well as current pics.
Starting by cutting out all of the rust in the wheel wells and removing the factory undercoating. Then I'll be masking off the area and sand blasting every inch of it to get a clean surface. The area will be treated with POR15 after welding to ensure that the rust stays gone on the inside. I'm removing almost the entire rear half of the wheel well and replacing it with a solid piece of 20 gauge metal (B). in the very center of the wheel well there is still good metal, and over that after it's sand blasted and treated I'll be welding in a thicker 16 gauge support piece (A), as it appears that area is a structural support. Once the support is welded in and the rear half of the well is attached I'll be applying the new outer skin to the roll pan (C). This is going to be 20 gauge metal as well. Treated and painted on the back side. Once all three of those pieces are in, I can weld the new front corners of the wheel well in.
In our cars we're fortunate that all of the area that tends to rust out is covered either by the bumper, or the ground effects. That means that I can concentrate on the strength and durability of the repair, as opposed to how it looks. After the new metal is welded in, I'll be using Fiberfill to restore the edges shape of the wheel well. This is probably the hardest part for me because i can never mix the hardener in the right amount. After these repairs are done, I'll be taping off the outer edge of the well and applying several coats of rubberized coating to the entire wheel well, after thoroughly drying the area and prepping it with a bonding agent. I've also been toying with the idea of adding a drain in the rear section in case of leaks from the hatch seal, and I'd be glad to hear any thoughts on that, this would be in the area of the rear quarter panel under the antenna and it's opposite side.
If all goes well perhaps I can supply the templates i created to someone that can produce them in larger numbers or on an as needed basis. I'll be coming back with new pics as the project continues. You can see below the shape it's in before I removed the old rusty material, as well as the plans for the new parts, which I've started cutting already
Metal band saw ftmfw.