I would not hesitate to run my engine at those temps. My rule of thumb is if its blowing smoke, running well and temps below 300 then its good for me. I try to run between 230 and 260 but dont get caught up with temps as there are ALOT of factors that can very to cause temps to run higher. If your running 20% with high oil it will run hotter then with byrons gen 2 30% with 9%oil for instance. Also it depends upon the temp gun used. I have a cheapy but check mine every now and again with a exergen temp gun as they are WAY more accurate.
As far as the mechanical problems you described it sounds like the previous person didnt drain his tank or used old fuel that collected moisture as that is the only thing that would cause rusting. If you wanna rebuild it thats up to you but sounds to me like there is enough wrong where it wont be cost effective to do so. I personally would buy another motor and this time dont get a vspec is my advice. Just my opinion though.
Hope the above info helps.