Pin holes in the bottom of the tank is from sitting a long time, either water in the gas or ethanol gas (aka pump gas). Either one sits at the bottom of the tank and rots it, and the gas above it is anti corrosive. There should be a pretty flat line where the rust stops. When the whole tank is nothing but rust, I think that's from being completely empty in high humidity, or someone did the acid trick to remove rust (and the protective layer) and then it sat with no liner.
For the fender flares, if the bolts are bad, just drill them out carefully. I think Honda still makes those bolts atleast in some form for maybe another machine, it's been a while since I looked for them.
Also on E2, why would you need to pull the flywheel to time it? There should be timing marks on the fly wheel as long as the key isn't sheered it should be pretty accurate.
Those chrome racks I don't think I've ever seen before, getting that paint off should be fairly easy since I'm pretty sure you can use some pretty strong chemicals on chrome and not damage it.
It should be interesting to see if the for sale running/project machine will sell faster than the fully built one. I have a feeling the project one will sell faster, or atleast draw more interest (people are cheap looking for a deal). The customers will be two totally different kinds of people most likely too.