3M Scotch Brite works best. I would do it dry though, rust is like a cancer. Unless you completely remove it, it will never stop. And you don’t want it to run down between the plates where it can start to separate them. I think a lot of transformers have a little surface rust because they are raw steel usually. I have a huge one on the floor of my shop a guy gave me that is almost new and it’s rusty too.Maybe some electronic cleaner and a stiff toothbrush could get the rust off without making too much of a mess.
If it really bugs you use a NYLON bristle brush to remove loose rust. Then paint it black if you want it to look nice.
What you don't want to do is cause the laminations to become electrically connected to each other. They have an insulating oxide layer on them that keeps them electrically isolated, and if you brush off the rust with a steel bristle brush, you might cause them to connect to each other which will increase hysteresis losses in the transformer.