They become parts cars when the cost of keeping them up is higher than their utility, or when they become dangerous to drive. If the frame, body, and interior are good, and they need mechanical attention, I would fix them. When the rust makes the body or frame unstable, it is time to part it out. You say you have had bad experiences with junk yards, so you need to find more reliable junk yards, and do your own parts inspections, and removal, before purchase.
You can buy a good engine from a pick-and-pull yard, for about $350, and a trans for about $125. If you have someone install them, you are looking at about another $500. If you drive it 10,000 miles (about 1 year of driving), you are at about $.10 per mile for the repair. At that point the car does not owe you anything. A new car will cost you more in one year than the $975 repair of the car. Even if you had to put an engine and trans in the car every year, it would not cost you any more than a new car.