I was tuning up my 95 Legacy yesterday with cleaning/testing throttle body & Position Sensor, PCV, MAF, etc. Started looking for my EGR valve to take a whack at but could not find it. Checked the Chiltons manual & tells/shows where it "should" be also says that testing the EGR is done by OnBoardDiagnostics & I have OBDII so wouldnt it be somewhere Checked online for pictures and where the EGR Pipe should be is crimped off. What is the meaning of this? Im boggled.

Post some pictures of your so we can see what you're talking about.

But for a 95 legacy, the automatic should have EGR, and the manual shouldn't.

What he said: 95 auto has EGR, manual does not.

 

If it's "crimped off" then it's been removed for some reason.  Posting a picture of the back of the drivers side head and the EGR will help us determine what's going on.

 

There's a few possibilities:
engine was swapped, non-EGR long block with an EGR intake...etc.

Your engine probably just doesn't have it.

It's simpler that way.

The car is a 5 speed manual not an auto. Previous owner had told me he replaced the tranny with a used one, I wonder if it originally had a automatic in it? Can automatics and manuals be swapped out in place of one another? With no "major" modifications?

it is possible, but pedal box, clutch operating mechanisms, and center console (shifter area) would all need to be changed/added/modified

 

Given that Subarus are kind of like Legos, anything is possible...change out the above items with the appropriate year parts and it could look factory.

 

a look at your VIN number will tell you what the car came with from the factory... http://www.cars101.com/subaru/vin.html

If they had swapped auto to manual the engine would likely have EGR, or there would be evidence of it missing the EGR parts.

 

Getting rid of the EGR is not practical just to accomplish a transmission swap.

EGR components are pictured here: http://www.subaruoutback.org/forums/439512-post9.html

This is in the back of the intake manifold, on the left side.