This is my third Subaru and I traded in a 2001 Legacy Sedan Limited Edition for it two weeks ago. I selected the 2008 Impreza because of its looks, performance, price and safety features. I test drove a 2007 Impreza Outback Wagon (the dealer was trying to give it away) and was not happy with its performance or appearance. The re-designed 2008 has an upgraded appearance and performance with a sport car attitude. While it may not look like a traditional Impreza, I think the exterior is sharper than the 2008 Legacy Sedans (looks like a VW Jetta). I am very happy with my selection, its driveability and (of course) its AWD and great handling (better than the Legacy).
Have to get the Premium Package (it's worth the extra $1200 or so). You get six disc CD, upgraded interior, fog lamps, & vehicle dynamics control (VDC)-a great safety feature. Also has 16" aluminum alloy wheel, dual front air bags, side curtain airbags, 4 wheel DISC brakes.
So far my gas mileage around the city has been on the low end of the stated fuel economy rating, 16-17 mpg. While the overall drive is smooth, it does have the usual Subaru automatic gear shifing slight delay-but the 08 is much better than 07 and no worse than other Subarus. Need rear cup holders!