As per a request, I'm posting steps to paint wood to look like rusted steel. Since my camera bit the dust, a friend of mine was nice enough to pop in and snap some photos for me. There aren't as many as I'd like, but they're decent and should give you the general idea. :) The wood we used is luan (also known as 1/8" ply some places) and 1x4 pine. You can use this treatment on any surface, but that's just what this example is painted on for your reference.
Things you will need:
Some paintbrushes you don't mind beating up just a bit
A palette knife
A paint sprayer (we used a pneumatic one, but a hudson garden sprayer works decently and a regular spritz bottle should also work in a pinch)
A base color for your "steel" (we used a very light white-blue, a dark grey-blue, and an olive green)
A warm dark brown, about twice as much as you think you'll need to cover the surface you've got
A dusky orange-red
Some really watery black or very deep brown
A smidgen of yellow
Alrighty, step one:
First things first, base your object with the color you've chosen for your steel.
Take your paint sprayer and lightly mist over the base coat, giving it some variance.
This is a fun step. Take some of your warm dark brown and add some water. Then, slowly mix in sawdust until it is oatmeal-ish in consistency. It shouldn't be too soupy, but should stick to together when you stir it and not clump up. If it's soupy, keep slowly adding sawdust. If it starts to get clumpy, add a bit more paint.
Then, take your sawdust mixture and plop it on some areas of your object that would be naturally rusty. For us, this was the outside edge of our "panels." Then let this dry. It takes some time, seeing as the sawdust holds so much moisture, but it needs to dry completely before you start the next step to minimize crumbling.
Use the orange and dab over the brown. Although you want to stay mainly on the brown (since the more severe rust would be on top of what has already started to decay), it is also helpful to dry-brush lightly over some of the unpainted center portion, just to give it some depth. This is my favorite part, the orange is kind of the make-or-brake color, so care not to get too random with it. You can always fix brown gone wrong with the orange as well. :)
Using your palette knife and both the orange and brown, make a few random streaks on your object, a'la Bob Ross. It is helpful to do the colors side by side, and also some of each individual color on it's own. The more you do the more beat up your object will look.
Last step! Almost there. :) Actually, this step can be optional, since we use it mainly because it helps give movement and a little more texture for viewing from far away (say 10+ feet for an audience). For this step you will want to water down some of the brown you have left (without the sawdust), as well as the orange you have left. Also, add just a little yellow to the orange to make it slightly brighter than what is painted already.
Using the brown, run your brush along the edges (top mainly) to create drips. The more drips, the more dirty it will look (obviously!). Also using this color, so some slight spattering by gently flicking the brush toward your surface, creating (hopefully) small spots of paint.
Using the newly lightened orange, repeat with the spatter technique.
Voila! You have your very own rusty object! :D Also optional, we added rivets (styrofoam balls cut in half) to our I-beams to make it look more realistic.
A view of the base sprayed, with the layer of brown texture.
Close up of the texture
Close up of the orange on our I-beam part
These are our finished sample boards. I love them both but tend to favor the darker of the two.