I happen to have an OLD Dragon (AD&D old) which describes tuning an existing spell's attributes and what level it should be, plus personal experience with fine-tuning spells.
Let's begin. *hands everyone popcorn*
Rusting Grasp starts as a 4th-level Druid spell. To make that available for Sorcerers and Wizards, add a level, making it 5th. It also affects a specific material (much like Rusting Grasp, it only works on non-magical ferrous metals), keeping it much the same.
Big difference comes from the range increase. Making it a 20' radius instead of touch would push it up two levels, making it Drd 6, Sor/Wiz 7. Adding the expensive component, be it a treated rust monster tentacle or a treated version of the material itself (which is what I would bend towards) would lower it by a level if it were 100 gp per spell level. So, it would need to be 600 gp worth to be valid. As a focus, that would push it up into the 3,000-6,000 gp range. So now we're sitting at Drd 5, Sor/Wiz 6.
Since the area remains constant, and is reasonable, that's not a change either way. Allowing a save isn't required since it won't affect magic items, though it would drop the level since Rusting Grasp doesn't allow one, nor SR. Allowing a negating save (since there is no half effect, really) would drop it one level. Though personally, I'd make it work against magic items with a negating save (Fort), and not allow a save for non-magical items, which would keep it at Drd 5, Sor/Wiz 6.
So, we're sitting with...
Gustave's Anti-Metal Burst
Transmutation
Level: Drd 5, Sor/Wiz 6
Components: V, S, M/F
Casting Time: 1 action
Range: Medium (100 ft. + 10 ft./level)
Area: 20-ft radius burst
Duration: Instantaneous
Saving Throw: None (object) or Fortitude negates (object) (see text)
Spell Reistance: No
By use of this spell, a caster causes a metal of his choice to dissolve, crack, rust, and pit, becoming destroyed and worthless. Magical items and attented non-magical items are allowed a save to avoid destruction, unattended non-magical items are not.
Material Component: An alchemically treated sample of the metal to be destroyed, costing at least 600 gp.
Focus Component: A statuette of a knight constructed of the chosen metal, costing at least 3,000 gp.
That should be appropriate, given what it does. And of course, the material component or the focus would be interchangable. If you don't have a focus, you'll have to use the sample, and if you have the statuette, you wouldn't need anything else. Unless, of course, the statuette is mythril and you want to rip steel to shreds.