I remember the man there Al tell me that RedKote doesn't mind the rust inside the tank.. I think he said it gives the coating something to adhere to..
Al is just making excuses for his failure to remove all the rust.
Just like you wouldn't paint over rust, you don't want to apply any tank liner over rust.
Even coated, rust never sleeps.. 
Correct, I used to paint industrial epoxies {my trade} that are far better than these tank liners, even with built in rust inhibitors and we ALWAYS remover any rust first, rust is a coating in itself, sitting on the good metal beneath it, if the epoxy sticks to the rust, and it does, that rust will still keep rusting and separating from the tank. You need a bond with clean metal, NOT rust..