Honestly, after you've done it once or twice you can change an Impreza engine in under 2 hours if you have a lift or A-frame. It's pretty straight forward.
Regarding the diff, if you only need to change axle stubs to use an AWD front diff, then you can use the OBX diff, provided the stubs are class legal. If so, that would probably be the one thing you can do (other than $$$ coilovers) that would really make a big difference for the car's performance.
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FWD is the new AWD
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