hello.rs is the "source code file". You want to write it in a code editor, then use rustc to convert it into an "executable file." The command looks something like this ("PS>" represents the powershell prompt).
PS> rustc hello.rs
When it's done running, a file called "hello.exe" will pop into existence (exe stands for executable file). That file is a program, just like rustc itself is a program, that you can run directly (the line without a prompt on it represents the output that hello.exe pushes to the screen):
Since hello.exe has already been converted into an executable program, you don't need to do it again (as you've noticed, rustc errors out because executable programs are not valid source code).