if you think the quilt has some intrinsic value, or if you just love it for itself but want to restore it instead of patching it, then this is what the museums do:
take and cut a small piece of tulle in the closest color you can find to the color you are trying to restore. with tiny almost invisible hand stitches, stitch the tulle around the hole or rust spot - getting as close as you can but not in the hole. put in as many stitches as you need, but keep them invisible. trim the tulle close, but leave a teeeeeny bit of extra around the stitched part, so it doesn't get pulled away. the tulle acts as a band-aid and keeps the hole from getting any larger.
i took two seminars on this technique in two museums with extensive textile (mostly quilts) collections. they even did this to huge areas on quilts to hold them together. the method creates an almost invisible structure on which the quilt hangs. the quilting designs were then worked right over the tulle as well as the original cotton. believe me, you would never know they had been repaired at all.
if you decide that you can't do the quilt justice, i'd be delighted to do it for you, and someday when it's all better, maybe i'll send it home.