Roy, I always heard covering the tool would trap the moisture. does it keep condensation off of your tools?
I haven't tried it but perhaps a Tyvek cover might work for some tools. It would pass water vapor through, but generally repel moisture from things like wet clothes coming into the shop.
Moisture forms on tools, accelerating rusting, when the tool is at or below the dew point temperature. The room temperature and dew point temperature are the same at 100% relative humidity. If an object is cooler than the dew point, water will form on it.
However rust can actually happen before observable water.
I don't know the best treatment for cast iron in tools. I have been lucky and have conditioned air, and very dry shops. Cooling air dries the air out because the moisture is removed (well some of it) as it passes over the cooler evaporator in the AC unit. Actually, having a lower capacity AC than needed in a shop can be a good thing. It will dry the air out a bit more, cycle less, and tend to take a little less energy than a normally sized AC. It is better to have your shop have it's own AC system, rather than use the "house" system.
Back to rust...the chemical action creating rust will roughly double in activity with every 10F increase in temperature. So a cool shop with non-condensing humidity will not have it's tools rust nearly as fast as a rather warm shop with non-condensing humidity.
Also, another trivia item from experience...a dew point of about 65F feels sticky or damp to most people. Conditioning and other factors may vary that for an individual. So if the shop is 80F and feels dry, chances are your dew point is below 65F. When your tools cool to the dew point, there will be condensation, like dew on the grass as the sun sets.
If you "bag" a tool, do it on a very dry day, and see if you can include some silica gel in the bag, as it will absorb water from the air in the bag. The silica gel can be warmed in an oven, driving the humidity out, periodically.
Sorry about the rambling, but as I mention these things, I realize that keeping iron from rusting in a shop is somewhat non trivial. Dry air and perhaps heat are your friends, but you have to be careful.
Final story. A person I know of put a ventless gas heater in his outbuilding shop, to keep it warm for wintertime work. The problem was that the gas heater gave of water as a combustion byproduct, raising the humidity in the shop, and within a year he had rust problems. Switching to a regular furnace and a forced air system solved the rust accumulation, and dried out the shop. When it was really cold, he ran the ventless heater a little to increase the humidity in the shop, which had the effect of reducing static. It also made it more comfortable when it was real cold outside, because the humid air feels warmer.