Don't drag me into this...ya bastage!
I gave up offering body and paint advice as most only want you to reinforce the "quick and dirty solution" they already had in mind...the correct way(s) is/are typically slower, more involved and more expensive. Good enough usually isn't. That said...
The more rust you can remove the better - all of it in a perfect world. Rust converters aren't, the rust
is the conversion, and once the metal has, it no longer has any value (scale rust is not structural or dimensionally stable). Complete removal is best, cleaning up what's there and protecting the area from moisture in the future is the next best, assuming nothing is structurally compromised by the existing corrosion. If you eliminate the moisture, the rust will not get worse than it is, it can't. Rust is not a growth, it's a chemical reaction, and one that can be stopped by removing the catalyst. How you do that is the crux of the biscuit...
I have read up this material but have no direct experience with it, but a number of members here have used it and with apparent success. Provided the you follow the instructions and the material "does what it says on the tin", in theory you should be good to go.
I purchased my LJ with a rust free frame ~3 years ago now. I initially looked at using the Eastwood products, but since changed up my approach. Currently, the plan is to use Waxoyl cavity wax inside the frame rails, after a through clean and dry to remove any accumulated dust, dirt and other loose crap. For external frame surfaces, I plan on cleaning up any minimal surface rust pits, etch priming and coating with a 2k single stage paint product (likely SprayMax Hot Rod Black. Over that, I'm considering a coat of Waxoyl Hardwax for additional protection on areas that take more abuse (skid plate and the like).