I'll go ahead and be the old man of the thread - 18s are generally heavier and cause you to have to pay a lot more for tires. Thinner tires combined with coilovers could also result in a horrible ride, especially over bumps.

I'd go with 17s, because rotational mass is important when you're not running a lot of horsepower and it can also affect braking performance without brake upgrades. I also think 17s are more than big enough for the 3rd gens - their GT models only came with 16s from factory after all. As stated, larger wheels make your brakes look silly, although 3rd gen Legacys have sizable brakes compared to the earlier gens.