anyone have direct experience dealing with a rust problem like this?

Car is a JDM MY00 wagon.

Oddly, the JDM MY97 wagon I had previously showed no signs of rust anywhere.

 

Doesn't look like a oem arch? Rust had be treated but its like cancer it will come back in time. You best bet is to cut it out and seal it. That little rust spot is just scratching the surface. Your inner arch is usually where it starts due to a built up of dirt allowing moisture you sit in there. No decent bodyshop can't do this work but they won't give no warrenty.