Given the price of thread at places like Connecting threads I would toss the thread and never look back. Since I started using cone thread I don't look at small retail spools the same way though I still buy them if I need to match a color. Starting with known good thread eliminates at least one source of problems when trying to troubleshoot a machine. Known good bobbins eliminate another. If a bobbin is too pitted it will catch your thread.
If you have a Harbor Freight Tools store in your area, they carry Evaporust too.
You can try white vinegar as a rust remover too though I don't think it's as powerful as Evaporust or citric acid.
Rodney