i'm not disputing your answer, but on the front drive stuff i'm familiar with, it seems more like a powder or an epoxy type of coating. so
however, you are A #1 spot on about a tiny chip starting the rot process !
i have often wished i had kept several of the front drive pans and differential case covers i have replaced over the years that have rusted through from the outside in.
to say they were bad would be an understatement !