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Hm that's unusual, hopefully just surface corrosion, but would look in the tubes (if you can) just to be sure there's nothing inside.
If there's a welding hole see what it looks like, perhaps nice salty sea air or road salt left a "gift..." Nice bikes in any case ^_^
Gears have their uses slogging up a hill with a load :p
I'd personally get the sandpaper and rust killer out (it's steel?)
May be some damp trapped somewhere, or something else that causes the spread, but it if rots through bye bye baik :(