After reading this thread, I decided to re-check my frame, and.. uh oh, guess I'm in the club. The rust appears to be in the exact same spot as the OP's much larger hole. It's a 2005 Taco manufacturing date of 12/04.
When I bought the truck 1.5 years ago I noticed some average surface rust, nothing to write home about. It was originally a NJ vehicle so I was hyper aware of any major rust issues at the time. The original owner was more than anal about upkeep, etc. That was the only reason I even considered the truck.
It has now gone through two Colorado winters (mag chloride), nothing out of the norm. It appears that a few select areas have deteriorated quite rapidly (see second pic). While the other frame areas are in good condition.
What should I do? I literally took these pics this morning. Take it in to a dealer? Fix and sell? At this point I'm not really even mad, just disappointed in Toyota. My 98 Taco had none of these isolated rust issues whatsoever. The frame appears fixable at this point, but what happens in a couple years when the rest of the frame goes to shit and it's a liability.
Welcome to TW & sorry for the rust.
You were correct to check it at first. I'm actually amazed you didn't see any. I'm in NJ and they salt the roads like no other. I was sanding and painting my frame after 1 winter.
Good luck in your soon to be long drawn out battle. It's the first guys who have to sacrifice the most.
You could always just go trade it in