Sounds reasonable enough. What do I do with the sections that pass this test, but have the surface rust/pits? Rust converter chemical and then prime/paint/whatever?
Lots of variables here. If it's just pitted, and not through the floor, I'd scrape it, wire brush it and coat it with POR-15, or at the very least, primer it with an epoxy primer like DP40 and then topcoat it (if you can even still get DP40, I think there's newer "safer" stuff out there now). It'll never rust again. POR-15 is an excellent product for stopping rust, and as long as it's not in a highly visible area where surface finish is critical, you'll never know it's there.
If you just have a few pinholes, but the rest of the metal seems sound, I'd still do like above. The POR-15 will take care of small pinholes and stop the rust from getting worse. Of course there's a point where, if the pinholes are too big, too close and the strength of the metal has been compromised, you have to move on to the next option: either patch or replace.
I do the pick thing also, although I'm not sure I'd do the "pound" thing. A sharp awl/pick can go through steel pretty easy if the metal has thinned at all, even if it's just done by hand. I just push on it hard. I don't believe in replacing factory floor metal unless it's necessary. Unless you coat the seams and rustproof it where it's been welded, it WILL come back. As long as the seams are good, and the majority of the steel is good, I'd rather patch in a spot with pinholes than cut out all the factory spotwelds. Of course you have to use a judgement call on how big a spot it is, how close to the panels edge, how much of the panel is pinholed etc etc.
I've seen lots of guys replace whole quarter panels just because it had a small bad spot at the typical areas, only to have all the seams start to rust because they didn't do it properly and take the steps to rustproof it afterwards. Cut and rewelded seams will always come back to bite you if it's not done properly. And factory metal is always well worth preserving, if at all possible.
All just my opinion, but I've spent a lot of years around a friends bodyshop, and he's restored at least 30-40 cars over that time.