Well I can only think the rusty water comment is a refrence to something like sequestrian of iron! what it does need is replanting in ericacious compost! they dont do well in alkaline soil, if that is the case you need to line the hole and put the ericacious in there and replant or water frequently with miroacid or something like that. I have a couple in the garden that were in when we came here but they always look a bit sickly to me and Im give them frequent feeds of iron and rhodedendron feed, mine are too large to dig out and replant.

Rhododendrons will only grow properly in acidic to neutral soil. So if you live where the soil is alkaline, chalk for example, your rhodo. will not be happy. If it is a small enough one you can grow in a large container of ericaceous compost, if larger then you are going to have to dig a huge planting hole part fill will ericaceous compost plant the rhodo. and continue to fill the hole with the ericaceous compost. Watering with rusty water will achieve nothing, you can give a liquid feed of sequestered iron a couple of times a year and also feed with an ericaceous fertiliser.