best bet is to gradually cut out the rust until you have just solid metal left.. when my girlfriend had her bug done, we were left with this:
luckily it didnt have the crescent vents, so the quarter panel was fine.. the reason your quarters have rotted is because moisture gets into the vent and held there by the factory expanding foam that is squirted into the cavity when theyre made. expect your quarter to be rotten way down to the wheelarch area.. consider fitting a pair of full rear quarters if the bumper and body mounts are bad and the lower front end of the quarters are crusty too. you'll end up with a much better finished car.
anyway.. we sourced a pair of good gutter end sections from a scrap car and welded them into my g/f's bug.. after paint was laid on the only tell-tales are the weld seams in the top corners of the engine bay (grinder wouldnt fit in there!)