I had an 46FX that the liner started pealing. I sent it in to Hobby Services and they replaced the piston, liner and both bearing. Your engine must be a older one or has a older liner because they claim to have fixed that issue about 2+ years ago. [>:] By the way, the repairs only cost me shipping to them. Also my engine has always had some rust in it. As long as it dosen't affect the rollers of the bearings I don't worry about it.
Send it in, get it fixed, and fly the hell out of it!!!