Does using slightly corroded steel, I mean steel with powdery rust colour effect the cement? Am I right that once its locked into the cement there will be no problems?
Corroded steel, rust, is not a problem if no further rusting (corrosion) is occurring. COR TEN steel, A242 and or A606 steel are self protecting grades of steel, where they form a protective layer of rust, oxides, that seal off the interior of the steel from further corrosion. Using these types of steel as reinforcement inside a concrete pot would be no problem at all, because no further oxidation will occur. Iron oxide takes up about ten times the volume of an equal molar amount of iron. So when iron rusts, the resulting oxide expands, and if this expansion is inside a concrete pot, or inside a concrete column holding up a bridge deck, the concrete will crack and flake off. We all have seen concrete columns under bridges with rusting reinforcing bars exposed, and concrete cracked and falling away. For hobby size concrete pots this is unlikely to be a problem, but it is best to use stainless steel mesh as support, or coated mesh as support. Avoid iron armatures, as the iron will rust, the rust will become the source of expansion and cracking.
Iron oxides can be used to color concrete, because once formed, iron oxide is stable.
Plain iron, low grade steel, should not be used inside a concrete construction because as the iron or steel rusts, the rust will expand, to take up 10 times the room the iron is was took. It is the transition from metal to oxide that causes problems, in the process of turning to rust, the iron expands and breaks your concrete.
It is okay to use steel, A242 and A606, which are CORTEN steel, and or higher grades of stainless steel. Not good to use are plain iron re-bar, and lower grade of iron is not good. I honestly can not tell you how to read the mill marks or stamps and or mill specifications. I am not a structural engineer.