97BkBrighton

So as the title describes, my reverse lights arent working. I have verified the switch, wiring, and bulbs all work. I have a 5sp manual 2.2l 97 legacy wagon. I even went and bought another reverse switch that threads into the top of the manual trans and tested it when it was out. I was able to engage the reverse lights with my hands but the transmission linkage is clearly not making contact with the switch. Once i was able to really press hard on the shifter in reverse to make the lights come on (which yes, could be over time, damaging to the trans) but i cant even replicate that effect even if I wanted to. I'm wondering if anyone has ever encountered this issue. Just seems to me that the 212k miles, 20 year old trans is just wearing out. Its solid beyond this issue. If i cant repair/modify the trans mating to the switch situation I was considering installing a custom switch in the center console so that when I shift in reverse the shift selector would engage the lights rather than the transmission itself. I'm mainly just wondering if anyone else has had this issue, I cant find anything on the internet period. Its all just posts about electrical issues which I would gladly trade for rather than a worn trans.

Thanks for the reply, if I threw a turbo on it would definitely be a low boost setup, mainly for fuel economy, the engine has 200k miles on it and its sohc so I wouldnt ve doing anything crazy. I'll have to look into the bilstiens, ive seen a few people mention the whiteline sway bars which will probably be my first upgrade. The wagon is in dire need of new struts though. On a side note I'm looking for a reputable source for remanufactured OEM cv axles. I dont have any clicking on turns but ive got some kind of a wobble going on. I can hear the tire oscilating on the highway. Doesnt sound very "true" in its performance.

So to start I have a 97 Legacy Brighton Wagon, all stock. I cant complain, the car has been a dream. I'm really looking into doing some modest upgrades to the suspension and improving handling. Going for a daily build with the ability to handle some "spirited driving" on the back roads. Possible ideas in order of interest; upgraded sway bars. Stiffer springs, maybe a bigger wheel setup? *p.s any ways i can squeeze a little more power out of a NA engine would be welcomed also. If you know of any reputable brands for parts, feel free to link them in the thread. Not trying to break the bank. Just classy upgrades that are good to start off with. *pic unrelated, me doing my timing belt at night.