When I purchased my Series 5 in kit form from Skystar in 1999, I found my freshly powdercoated fuselage to have similiar problems to what you are finding on yours. Apparently the vendor they used did not adequately prep all the tubing and I found area like you are finding that had to sanded to bare metal and primed/painted. The old kitfox owners (Skystar) had very poor quality control in my opinion as other issues reared their ugly heads during the build. (gaping holes in new fuel tanks that the factory said were pressure tested, poor quality with the quick build wing etc ) From what i hear from new builders now , this is not a problem under the Mcbeans ownership but older unfinished projects that are floating around should always be thoroughly inspected like you are doing. I think you are doing the right thing in taking it down to bare metal and starting over. I would talk to a local sandblasting shop about the project and go from there. I had a small harbor freight blaster that I used to cleanup the suspect areas and that worked fine, but for a hole fuselage i would take it to a blasting shop. Bruce N199CL