Hi Iain.... Im no Datsun guru but I dont think that matters anyhow. What model Datsun is it ?
My advise if you're really serious about saving it is to carry out the following.
1. Unpick the entire sill panel so only the inner remains.
2. Have the door pillar, left kick panel and inner sill panel sandblasted professionally unless you have all the respiratory safety gear. It looks to me like someone has has a go repairing these sections previously. The only way to get it right is by blasting the inner sill clean if your after a permanent solution.
3. I guarantee that the inner panel will have pinholes, these will need to be welded up or patched. The missing inner section will need to be fabricated.
4. If its a popular Datsun like a 1200, 1600 or 240z you may be able to buy a replacement outer sill panel (either genuine or non genuine).
5. Clean up and prime the inner sill panel with some quality waterproof metal primer that wont absorb moisture.
6. Plug weld the outer sill panel or use a 3 phase spot welder (which I assume you dont have otherwise you wouldnt be asking for advise
7. Fish oil the cavity when finished.
I dont think patching that sill is a good idea, I think the entire section needs to be stripped and replaced due to the extent of the rust. It'll probably look 3 times worse once its blasted however that'll give you a very good idea on what your dealing with up front rather than trying to patch bits and pieces as you find them.
You'll want to dummy fit the panels on that side prior to plug welding to ensure or the panel gaps look right. It's probably a couple days work for someone who knows what they are doing once you have the sandblasting done. You can check out my restoration in the Mazda section for detailed ideas !