Bob,
I know that we expect others to treat our stuff the way that we would, but that just isn't the case. It's too bad really.
However, I don't think it's that serious. How are you going to finish the barrel??
If you're going to brown it, you'll need to clean it up any way. The barrel doesn't look like it had a high polish on it to begin with. So clean it up with some 220 grit backed with a good flat board, or the like. You'll probably need to change the paper often.
If you're going to polish it, do the same thing, then progress to finer paper.
Like Mr Brooks said, the inside is much more critical. I hope you've already oiled that.
That being said, steel wool wrapped around a wooden dowel should get rid of the surface rust. Clean well and check for pitting.
Last question.... did you have it insured?? If the barrel is damaged beyond repair, and it was insured, they should make it good.
Hope this helps.