I've ued water mixable oil paints (same that the previous poster mentioned) for weathering, and I like them. They're fairly easy to work with, and if I really screw up, they can be washed off, without doing major damage to factory paint.
I don't currently have any good colors for rust in oil paints, (Small town, no local supplier) But, black is always good for griming things up, and white works great for creating that smeared effect you often see under large white letters on cars.
Let it dry for a few hours, then clear coat it.