I used the grease gun method to force out the caliper piston. Upon closer inspection, I found that the brake pad sticking in the housing was the problem. The inner caliper housing is still shiny and undamaged, but the piston itself has about 4 tiny rust pits. I can buy a complete caliper on Ebay with new pads for about $80, not OEM. I can buy a piston with seal for about $50, again non-OEM.
Does anyone have any experience of these replacement parts?
I am tempted to just reassemble using the existing parts. I can't see why it would seize or leak for the moment while I carry on bringing the motor back to life.
Feel free to suggest a course of action.