If I find a rusty fuel tank or a bad carb should I walk away or are these things that can be fixed? If they can be fixed, how much will it cost?
These are all things that can be fixed. Unless the rust in the tank is -really- bad, water tends to condense at the bottom of the tank. So it's a wise idea to inspect the bottom of the tank, check for bubbling in the paint or 'soft' areas that may indicate rust through.
Tanks can be coated, mine has been, definatly worth the cost. I'd actually recommend it even if the tank is fine, since it basically covers the inside of the tank in plastic. That way you won't have to worry about rust later.
Carbs are a little more tricky. Usually they can be fixed, but parts for our carbs are getting hard to find. Oddly enough you can probally find all the o-rings in the carbs at a hardware store, I got mine at Ace. Specialized stuff, though, you will have to order. Occasionally you'll see B4 carbs on Ebay, even rarer yet you will find a set of GSXR400 carbs, which are a tad bit bigger but also work (identical internals as well). I suspect that the carbs off the GS500E have identical internals as well, but I've never taken one apart (I personally suspect that the GS500E is using the two outside GSF400 carbs).
By the way, I'm 6' 2" and was 230lbs when I got my Bandit.