Welcome to the boards Bob.
Hehe, you're going to find that a lot of us have run the Saab 900 TMIC on our cars, so we can't really say a whole terribly lot

.
To answer a few of your questions, that's a lot of money for an old car. But if it's as clean and pristine as you say, I can't say it's not worth it if that's what you're looking for.
With regards to the 5spd's, they're pretty solid at stock power levels. Going after the power can bring some problems, but I don't suspect that's anything your friend has to worry about. The AWD is actually a viscous and at only 76k it should be plenty fine. You will find that there are a lot of options for replacing the open rear diff with an VLSD from other Subaru models. Your friend's car will be sporting a 4.11 : 1 ratio drivetrain.
As far as things to watch out for - the original knock sensor was a bit of a faulty design and Subaru changed it in the mid/late 90's. The new ones are a direct replacement. The knock sensors just have a tendency to crack, it won't stop you on the road but it will retard the timing and reduce power and mileage. The other big thing is the CV joints. The relatively high angle of these cars tends to go through CV's. But if that happens, just get a shop to put in a replacement with a lifetime warrenty and you'll never have to worry/pay for them again. Not everyone has troubles with them, but it is semi-frequent. Along those lines, make sure you inspect the CV boots before buying the car - if they're ripped you're going to need new axles.
You're going to like the braking system on these cars. Subaru really did design the old cars based off their rally heritage and are actually pretty sports cars for their era.
Being in Mont. you will really appreciate the ability of these cars to take a beating and keep going. The suspension is pretty strong and not easily knocked out of alignment.
I'm sure others will chime in with some more suggestions but that's what comes to mind immediately.