Got myself a Meguire's headlight restoration kit and took some step by step pictures. There are simple instructions on other forums but a quick search showed none specific to Legacy's so I figured I'd post up mine. My 05' at nearly 8 years old only has 58,000kms on it, but the headlights were the biggest give away to its true age.
Here is the before:
Step 1: Wash the car. It's always good practice to wash your car before doing anything regarding the finish of the exterior surfaces.
Step 2: Inspect your purchased kit. I have done this before with another brand on my brother's Saab 9-5. The kit was one involving purely wetsanding and hand polishing. Quite labor intensive, so this time I bought Meguire's kit with a drill attachment for the polishing. I'm impressed with the time and effort saved.
Step 3: Dry the area in question.
Step 4: Tape off everything within reach of the drill attachment, and then tape off more, then when you're sure you've taped enough go around one more time. You can tape hood up or hood down. I prefer hood down as the tape adheres better to the hood and it doesn't interfere with polishing whatsoever. I used painters tape. its enough adhesion, easy to use and not sticky enough to leave a residue.
Step 5: Polish. I found it less messy to apply the polish directly to the headlight and keep the drill moving slowly. The more polish you've removed the faster you can go. The polish is harmful to the paint if exposure is prolonged so try not to spray it all over your hood and bumper with an over exited trigger finger.
Step 6: Buff. Once you feel that you've taken care of the polishing (I spent about 5-7minutes re-applying it 4 times) grab the micro-fiber from the kit and wipe away and buff the residual polish. If you notice and area with some grime or haze still go back to step 5 and repeat.
Step 7: Remove tape, wipe down any area that could've gotten polish on it. Remember its bad for your paint, don't want to forget a drop of it that splooged onto your hood when you got too excited with your drill! Admire your new headlights.