I just soaked everything in gasoline, skrubed everything with a toothbrush, and replaced the brake shoes. Make sure to grease all the bearings and axle too.
DO NOT SOAK BRAKE PARTS IN GASOLINE. The pads WILL soak up gasoline like a sponge and it will RUIN them.
This is what you do....
Sand pads at a 45 degree angle with 100 grit sand paper. Do the same with the drum... Do it just enough to remove any surface rust or glazing on the pads/drum.
Clean out the drum with Brakkleen (or any other brake cleaner). Then spray some brake cleaner on a rag and lightly wipe off any dust on the pads...
Don't spray the pads with brake cleaner, you could ruin them.
Then just re-assemble and have the brake set kinda tight so that as soon as you barely push down the pedal you get some drag.
Do a couple low-speed stops on JUST the rear brake. Then step it up a little and do some high speed stops on just the rear, just to ensure it's seating in the hub and cleaning off any excess brake cleaner. DON'T lock up the brake on these tests... just kinda slowly apply them so that the bike comes to an easy stop. (A grass field works best considering it grips harder than dirt.)
Good luck. Should have you running like new.
Dan
P.S. Do check the bearings and make sure they've got grease... good call...