I've seen the guy on the "BikeIt UK" YouTube channel use a product called Kurust for neutralizing/converting rust before doing touch up painting over it. AFAICT, it's not sold in the US, so at the moment I'm waiting for it to arrive from Merry Olde. I'll post results when/if I see it. Apart from that, I had pretty good results with Meguiar's Scratch-X on a 1989 Schwinn Circuit that had dulled, but not faded paint and no rust to speak of.
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"Don't take life so serious-it ain't nohow permanent."
"Everybody's gotta be somewhere." - Eccles