from the WD40 website:
http://www.wd40.com.au/wd40/index.php
"WD-40 protects metal from rust and corrosion"
And Budweiser's a "...fine beer" it says so on the label, ya can't believe advertising hype, WD40 will displace water and inhibit rust, for a day or two, it's not meant for long term storage of HC Steel blades.
I've been a mechanic/machinist/millwright for over 40 years, I've used everything out there to protect and store a variety of rustable metals, car parts, tools, including mills, drills and a lot of other HC steel cutting tools which are nearly identical in composition to what they make knives out of.
You basically either have to coat it with a long term hard clear coat or some thing easier to remove like an oil based protectant. Cosmoline(sp) which I've seen wiped off military knives and guns 60 years later with some solvent and the metal was the same as it was when they stored it.
Now the most important thing about long term storage is prep, usually this involves cleaning and thorough drying before applying, if you seal/protect the blade with finger prints, (which contains corrosive oils and acid from your body) then you have essentially sealed the problem under the supposed solution.
Lastly, scabbards, sheaths, what ever you call them and no matter what they're made of are only for carrying, transporting of your knife and to protect the sharpened edge and your fingers but should never be used for long term storage as it traps moisture and depending what is made of could either outgas or contain harmful chemicals which would damage the finish on your knife if left on it for a long time.
As to the knife being replaced/repaired, rust is not a defect and if minor without pitting is just aesthetic and in no way impacts on the performance of your knife.