I used to live up north and I've probably fixed a lot of rusty stuff that I shouldn't have bothered with. If the rest of it doesn't look bad, it's probably worth keeping. I always go to the next thickness up for structural plates. It's good if you know someone with a brake for forming the pieces, or you can cut up some square or rectangular steel tube.
GOing thicker than stock does nothing...going thinner is bad, same thickness makes welding alot less stressfull.
But my 89 SJ Grand Wagoneer had rust like that....I sold it for scrap. Once you get bad rot like that its hard to get rid of.
The issue being that the stock piece of steel was bent for strength, the replacement piece won't be machine bent to perfection, so going slightly thicker won't cause any issues and would be a good idea imo.
Had the same issues on my 93 Cherokee, even bought a mig welder, but just couldn't find the time, found a super clean 5.9 for $3500 so that killed the restoration.. Scrapper came and got it for $275(no title)....
Plate it up with 1/8" steel and put a pair of rectangular tubes along the rails, kinda like subframe connectors. They'll restore any lost structure and provided added strength for the stress of future wheeling. When you rebuild any trailing arm mounts try to tie them to the tubing, not just the OE rails.
I would think real hard about adding gussets and/or sissy plates to the rest of the trailing arm mounts. A little goes a long ways and you're gonna be stressing those mounts harder than ever due to the lift components. Even if they look sound it's possible they're corroded to 75% of new strength
75lbs of plate and tubing and that sucker will be stronger than any non-corroded GC.
Mine wasn't that bad, but close. I went with front long arms to move the stress points. (Was about to lift anyway) Cut off the lower ca mounts. Used 16 gauge steel to patch the holes. Painted entire underside with por-15. Strengthened unibody with tnt frame stiffeners. I also bought a product from eastwood that coats the inside of the rails to curb the rust from the inside. Believe me and others when the say its worse than it looks. We originally thought the problem was in one small area but as we started cutting, the hole got bigger and bigger. Be ready for a job much bigger than you think. That being said, it was still cheaper than buying a new zj and going from there. GC's around here command a high price. You really need to be honest with yourself about the rest of the rig. In my case, I had a drivetrain in excellent condition and I had done enough work on the systems (elect, cooling, etc) that I know that it would be a huge step backward to buy another one. I also looked into buying a shell and swapping everything...did not have that kind of time. As it was, the work is still being done in stages and has taken most of the summer. I am now in a race to finish before the snow flies. Good luck!