I would definitely start by replacing the engine with a turbo legacy engine instead of a stand alone turbo kit. Why, because those engines are bullet proof, they're pretty cheap, and well save you a lot of hassle in the end. I'm planning on putting in a 92 turbo motor in my 94 legacy. Here I'll just make a list of some mods to consider and that I'm hopefully going to do.
Suspension: KYB AGX Struts with Eibach, Prodrive, or H & R Springs
Big Brake Kit: Outback H6 front rotors and calipers, Turbo Legacy rear vented rotors and calipers
Exhaust: Prodrive Oval Tip Muffler with turbo xs downpipe
Engine: 92 legacy turbo motor with vf34 turbo
Tranny: STi short throw shifter kit with PDM shifter
Exterior: Turbo legacy hood with STi hood scoop and 1st gen rs vents
Front End Conversion: 1st gen rs front bumper
Paint Job: wrx silver (or wrx white with a pearl blue "shade") with a rally subaru S graphic in ghost color or black.
I think that is all for now, lol... This is how my car looks right now, not much, but hey, you got to start somewhere...
Also a good Legacy site to check out is bbs.legacycentral.org