Just like the mixer in my kitchen and the various tools in the garage, sewing machines were "tools" of the day and treated as such - especially by a tailor of a seamstress. Those are hard earned battle scars, or as I often refer to them - their stories. Would I rather a pristine machine? Sure. Will I pass one over because of rash? It really depends on what I want it for. Certainly for usability, I won't. They're run in good when they've got rash.
One of my favorite machines in my collection has a lot of damage from pin rash. It's just more of her stories and she's got a lot of them.
I was thinking a piece of leather like what they make tool holders out of would work well. I have some from when my dad took me to leather classes. It's probably 1/8" or more thick and should ward off needles. You might even be able to install a plastic snap to secure it to the machine... and a little fabric under that to make sure it doesn't scratch the machine.