Busy weekend but update. Interestingly enough, I dropped the skid and used a flap disk/grinder to get all the rust off down to bare metal and it didn't take much at a ll. Basically the flakey/chunky bits were knocked off and bare metal wasn't much deeper than that. Similar story with the interior facing frame rails. I'm sure there is some amount of rust on the interior, but the fact that I was able to get down to bare metal within a few seconds of using a flap disk and just taking off the rust seen in the photos is promising to me. I also carefully felt around each area of the frame where holes are present and everything is smooth with what feels like just a bit of surface rust - nothing flakey or rot feeling. I did drill holes in the bottom of the control arm mounts to allow water to drain, which it did promptly after considering I flushed the frame out with the pressure washer.
That being said, I was in a rush to get the job done before the wife came home since I was using her bay in the garage. In the process I snapped off two of the skid mount bolts (center bolt on each side, so each corner is still there). So that will be another project to work on in the very near future. Skid plate had similar levels of rust in the same areas as the frame. I ground it all down as well and painted it along with the frame. Went for a drive (yes even with the 4 bolts instead of 6) and all is well. I won't be driving it anymore until I get the bolts replaced.
Overall I'm slightly surprised but happy to have found that the frame isn't as bad as it looked. I will reiterate, absolutely zero holes or deep rot was found. I wonder if somehow the skid lip was holding snow/moisture above those areas and allowed it to rust mostly on the outside. Odd design for sure. I did place a couple washers between the skid and frame when I reattached it so allow for airflow to hopefully prevent issues like this in the future.
Anyone have any leads on replacement bolts and the best method to get the rest out? I've read that they are nutserts instead of flag nuts..think I should just drill them out?