I have an 86 GL they are great cars. Mine has a 2" lift that i am thinking of taking off. For the mild off roading i do, the factory ride height has plenty of clearance. It's just a cheap homemade lift with spacers on the shock towers and an aluminum block between the body and subframe. You will need a slip joint to extend the steering shaft. I can take pics if you want to make your own lift. I have only seen a lift from just springs on first gen legacys using outback springs. I might sell the lift, but i am busy with my camaro at the moment.
I had a set of 15" six lug chevy wheels drilled for 4x140 but i sold them, i like the factory 8 spokes. Expect 35+ mpg hiway with 15s, you essentially add another gear at speed. I got 40 mpg.
As far as upgrading your engine, i understand that a weber carb is the way to go, i took the ea82 out and put in a ej22 a while back.
Maybe your carb needs a good cleaning and rebuild kit, and perhaps different size jets. If you eliminate vaccum leaks as a reason. It took me a day working slowly to rebuild a rochester monojet carb, and i needed a size smaller jet because of altitude, but my camaro wouldn't rev. Idled fine and revved with no load on the engine. I think the Hitachi carbs have two jets.
But try this because it's easy, take the air cleaner off and start the engine. Open the throttle to the point where she starts to struggle. Have a can of brake or carb cleaner and give her a little spray and see if she runs better. You can also use your hand or towel to mess with the throttle and cover the air horn. If it gets better, you might be running lean or have some fuel issue, but at least you can eliminate plug wires with this. It might give you a clue, maybe the fuel filter just needs changing (it's under the car near the pump)
Happy wrenching! What is your cars name? Mine is the baby lion.
Your girlfriend might be a keeper for saying no to selling the subaru! If you are ever in Denver, help me take this lift off and you can have it :-)