For reference in case you haven't been able to get a good picture in your mind of what the subject components look like, there are some photos from Blue Bird's assembly process over there
to help visualize the shape and extent of the chair rail section. Other makes seem to be constructed similarly. Most of the rust in your photo is in the chair rail, which is a Z shape running vertically down the interior wall, horizontal about 2 inches across the floor, then down again on the outside of the bus.
It actually isn't all that hard to manually bend a 1x1/8 hot rolled angle so you could perhaps bend a section to follow the contour and provide something to anchor new flat sheet into.
As an alternative you might try hammering/stretching a curved flange in the replacement sheet and skip the angle steel altogether. I'm thinking maybe cut the vertical chair rail patch say 1/4" to 1/2" oversize around the wheel house so that the oversize part can be hammered toward the interior 90 degrees, making a ledge to which the replacement wheel house steel can be fastened. A little corner like that doesn't have to be pretty so you probably could form it acceptably with just a normal construction hammer and a random heavy chunk of steel as a dolly.
I guess I'd start by cutting out as much as is necessary to 1) get the weak rusted stuff out and 2) open up enough room to manipulate tools to achieve #1. You might be cutting out steel that's fine in order to make sufficient room to work comfortably. Watch out for the hat channel/rib running up the wall. It is behind those 4 rivets at the left edge of the photo. There'll be something similar supporting the floor too, so take care to cut only the floor sheet and not the supports below it. After it's opened up a plan of attack will probably become clear. One other thing before cutting it open: make a cardboard template of the curve on the wall. You can use that when fitting new steel to make sure it's close so that the repaired wheel house won't have a weird shape there (too high or too low compared to the inboard side).