It pretty much comes down to this.... the vendor has stated their conditions of sale as is their right. If any interested parties are unable/unwilling to comply with the conditions of sale they can exercise their right to NOT purchase the car. I see that some prospective purchasers consider that a vendor who clearly and reasonably sets conditions of sale, but fails to satisfy the expectations of some prospective purchasers, is automatically assumed to be trying to hide something.
Rather than being a reflection on the vendor, this is a reflection on the prospective purchasers attitude. The vendor very clearly wishes that prospective purchasers should make their own inspection and assessment to avoid any misunderstanding regarding the cars condition. This seems eminently sensible to me given the age and stated "non-roadworthy" condition of the vehicle. By insisting on inspection prior to bidding the vendor is ensuring that full liability for all and any work required to return the vehicle to roadworthy condition lies with the purchaser.
I'm not suggesting that there are not vendors around who will misrepresent the vehicles that they are selling and caveat emptor applies. All I'm saying is that the vendor has the right to set the conditions of sale and if those conditions explicitly recommend inspection before bidding, then that can be seen as sound advice to anyone concerned about rust. Given that the car has been parked up for ten years there is likely to be a lot of maintenance required to get it up to WOF standard. I don't know if the CSI is rust prone but a friend in Auckland with a camera should be able to help you out with some pics
Cheers...