Mike, I agree that cutting out the rusted spots and welding in new metal is best. I only mentioned doubler plates, because sometimes they're needed if there's a lot of metal gone in high stress spots. I welded in new metal and ground the welds so the patches will be pretty much invisible when the frame is blasted and painted (although the new metal will be a little smoother.
If OlderBlue would post some pics of the damaged area we could give more specific advice.
