I posted my question on a heating system website and the folks there think its highly unlikely that its corrosion on the inside of the radiator, apparently its extremely uncommon. Based on how I described the valve turning and turning, they think that there's an issue with the valve. I guess its common for this type of system to have whats called a 1/4 turn valve, meaning a 1/4 turn opens it from fully closed. The recommended I crank the heat and try turning just 1/8th of a turn, to see if the stops within the valve have been broken, and all my turning has simply been opening and then closing and then opening and then closing (etc) the valve. Otherwise its likely a broken valve. If that still doesn't fix is I think as a last resort I'll check on the corrosion.
Checking if 1/8 turn works....free
Replacing valve....probably $10 in parts and a couple of hours to drain system, take apart connections, refit and refill
Replace whole radiator...probably $300 for the radiator, plus a couple more hours to take drain system, etc.
I think I'll eliminate the simpler things first.
Still, if when I take off the valve if a bunch of rusty water pours out, I'll know right there, I suppose....