I use Kroil bath and copper/brass or bronze (best is bronze) wool. I keep the parts in the bath as I am lightly rubbing the parts with the non ferris wool. The whole idea is to keep the friction down and the rust removal at the best efficiency.
Kano Kroil - http://www.kanolabs.com/
Brass Wool - http://www.brownells.com/aspx/NS/sto...le=BRONZE+WOOL
Brownells Oxpho Bluing - http://www.brownells.com/.aspx/pid=1...XPHO_BLUE_reg_
Depending on how bad the surface rust is, the bluing should be ok. If you want or need to blue it via cold blue, I would suggest Brownells Oxpho blue, good stuff, works well and easy to use. I would also suggest doing the whole part, not just spots. Hot bluing leave to the pro's, it is usually well worth a professional bluing.