I posted this over on scoobymods.com (I am known as dark_vandal on all the other subaru forums except this one) and wanted to post it here for you all to see.... a lot of people wanted to see this, so here it is.
Here are some materials you might like to get before doing this:
I'd recommend Q tips, tooth picks, and a heavy duty remover (i.e. Goof Off). nailpolish doesn't really work (I tried it). Just whatever you use, don't use something that is harmful to plastics. Goof Off is pushing it, but I didn't notice it eating away at the badge plastic.
1. First you need to pop your stock badge off from the car. This is relatively easy to do, but be careful to do it slowly. You'll want to take the grill off the car (4 clips) and then heat the badge with a blow dryer for several minutes... the hotter the better. Then use something thin (i.e., a butter knife) and pry the badge from the grill (I'd recommend using a cloth so as to not scratch it... you should also pry from the underside of the badge (bottom) so in case you do scratch it, it will not be noticeable when it is on the car.)
2. Here we have our badge off the car. I actually did this to an '03 WRX badge (my WRX is an '02). I like the 03 badge more, as the stars are bigger and just look nicer IMO.
Here is the reverse side of the badge. It is basically chrome inserts covered by blue paint.
3. First off, start off by using some of the goof-off to start removing the blue paint. It comes off pretty easy. Use a Q-tip saturated in the remover to rub off the paint. You might also pour some of the remover on the badge and let it soak so as to soften up the paint. As you do this, most of the chrome will start to come off the badge. However, little fleks of chrome will remain in the edges of the stars. I used a toothpick to scratch at these and remove them. This part was a PITA and took a very long time. Continually inspect the badge until you remove all the chrome.
4. Next, clean the badge very well with soap and water. let it dry well. Check again that no chrome specs are in the stars. Your badge should look like this from the reverse. You'll see some remaining paint on mine on the edges, but this doesn't matter as you can't see it from the front.
5. Now it is time to paint the stars and the loop. I did this with some red caliper paint i had left over. I just sprayed it into a cup and brushed it on. I had some paint thinner and paper towel handy to wipe off any mistakes i made (it is pretty easy to paint the wrong part of the badge, especially considering the nooks are so small.
6. Give your badge 3-4 coats, allowing enough time to dry between each coat, like any other paint job. Make sure you have enough coats so that when you hold it up to the light, no light can get through the paint. It should look like this:
and the front side: