Bubbles in oil when I check dip stick, Is this normal? Also, how do you get rid of rust that is developing along but joints. I bought 400EX used. thanks.

 

Change the oil and run it some. The first rule when when you buy a used anything with a motor is to change the oil even though the old owner said that he changed it last week. This might take care of your problem.
I have no idea about what part of the quad that you are talking about that has rust.