Welcome Santora -
Stiff opening and closing is good. Don't oil it. When you're done that thing will be very sharp and you don't want it flopping open.
What you will use to clean it up depends on what final results you want. If you're looking for a perfect mirror finish, you've got a lot of work ahead of you. Best first bet is to use some MAAS polishing compound. See where that gets you. That'll get rid of the tarnish and any light blemishes and you'll have a better idea of what you're looking at.

For rust, you'll need to sand it out which could mean going all the way down to 200 grit depending on the rust. Start higher, because you can always go lower.

Check out the restoration forum here (the Workshop) for some complete restoration walk-throughs