the trans tunnel is aluminum, so rusting is not going to be an issue. I don't think many coat the inside of the tunnel for that reason. sound deadening is a separate issue.
might be too late, but most find it easier to cover the dash first before bending the ends. Not sure what your plans are for the dash face. also, most dashes I've seen just need to be bent it in one plane. looks like you're bending and twisting the ends.