No, you can't use anything with a spin on filter!
The phase2 came out in mid 1998, and has a spin on filter on the left side,
this is the transmission that you can not use.
If it has a spin on filter on the transmission you will not be able to make it work without rewiring the car!
If the 96,97,early 98 Subaru has a 2.5 engine, then it has a 4.44 transmission.
We are talking Legacy GT, Legacy GT Limited, Legacy Outback, Legacy Outback Limited, Forester, Impreza 2.5.
I have heard from a Subaru expert that the Legacy LSI has the 4.11 transmission, but do not know for sure if that is true for all of the LSIs.