I would wire wheel it down and repaint with a matching color. POR 15 would be a great product to use but prep is key for it to last. If the trailer is a keeper I would look into having the trailer Line X coated while the boat is in the well for the season.
The rust can be scrubbed away, (use rubber gloves) apply a calcium, lime and rust remover to the affected area. After a while remove it with a sponge. If you have no results, reapply it and use the scuffing side of the sponge to scrub the rust away. After finalization, wash the area with water.