hurraayy
cool thing is, the rotor/carbon fiber is not damaged, as far as I can see. My kevlar bonded losi got damaged by sand, so I put some thin super glue on it. like that the damage didn't get worse. I don't think that this has to be done here.
just clean it, with e.g. break cleaner. I always took some kitchen-anti-grease cleaner, rinsed it with water, and dryed it CAREFULLY. but I don't know if I can recommend it like that, but it worked for me.
you can get rid of rust with e.g. vinegar or so (light acid). I assume, that rust is not good for the function of the magnets. but don't take too hefty stuff, don't damage the coating of the wires!! e.g. you can take cleansing alcohol, that should be fine.
it seems that the motor got completely wet, because the bearings and the insides are rusty. But I think it's not a problem to fix it, besides the dust it looks good.
when you have redone the motor, you have to seal the not used holes of the font endbell, and you could dustproof the rear metal cap (to prevent the rear bearing from dust). and use some loctite (medium) for the screws.
You can go for ceramic bearings, if you want, or at least have yourself some quality stuff.