Parts I recommend:
I get asked for recommendations quite a bit. Here they are. If the part isn't listed here, I don't recommend it or I'm ignorant to it.
Springs / Coilovers / Struts:
I do not recommend any lowering springs for the stock struts because the stock struts have no bump travel to spare.
I do not recommend any low-end coilovers because the quality control (and often design) on them is junk. Some are better than others, but none are good. There are very few suspension companies on par with, let alone better than, KYB, who makes the stock struts.
The stock struts are good. They match the stock springs decently. However, they run out of lubrication with use, and the stock bump stops are a bit firm initially. I recommend repacking the struts with synthetic grease, which is extremely easy to do, and replacing the front bump stops with Prodrive/RCE parts. If you do not do this, the stock struts will deteriorate until they make noise and/or ride uncomfortably.
The cheapest way to lower the car a small amount, plus get a modest boost in performance, is to buy RCE's "lowering" camber plates. This will lower your car 3/8" up front only, to even out the fender gap, give you a more aggressive alignment, and get rid of the very soft rubber front strut mounts. They lower the car by moving the mounting point of the strut upwards, not by changing the resting point of the strut so that it is further compressed, as lowering springs do. Thus, suspension travel is identical to stock- there is no loss.
Ground Control:
A much better option is to buy Ground Control's camber plates along with Ground Control's coilover sleeves. These only work with 2.5" diameter coilover springs, but the smaller diameter spring means the camber plate can be designed much differently. These lower the car a full inch without sacrificing suspension travel, plus allow for more caster and camber adjustment than the RCE plates. For the stock struts, run a 250lb, 8" long Hypercoil front spring. Since you gain an inch of bump travel with camber plates, and you will now have an adjustable-height coilover sleeve, I recommend you lower the car only 3/4". This will net you 1/4" more bump travel than stock even though the car has been lowered 3/4".
I do not recommend Ground Control's coilover sleeves for the rear without running camber plates in the rear, otherwise you will have a coil bind problem when the car is loaded. You need a 10" spring to have sufficient travel at 200lb/in rates, and with Ground Control's mount for the stock strut tops, that'll raise the car about 1.5 inches. Instead, you must run 8" springs, which have 5 inches of travel when you need 6 inches or more. So, to save money, keep the stock rear springs and mounts.
Helper springs are recommended, but not required, for spring rates over stock (~200lb/in). I again recommend Hypercoil and their "zero rate" parts, others are much too long at full compression. The stock struts can safely handle roughly 300lb/in front springs and 275lb/in rear springs, but I recommend staying below this threshold because the car gets a little floaty there.
Because Ground Control's kit for the rear is a little more complicated, due to spring travel issues, an ideal setup would be Ground Control's front "coilover" kit with 250-275lb/in front springs and traditional "lowering spring" rear springs, such as those from Swift or RCE. I do not believe vendors sell front and rear springs separately, however, so doing so combining parts would be expensive! That puts you into coilover price territory.
Speaking of, when your struts wear out, you can easily replace them with Ground Control's custom Koni struts. The single-adjustable Ground Control struts are not decent, but not great. I find their modifications to the default Koni valving to be a step backwards, although Ground Control's double-adjustable might be better. Still, it's nothing I wouldn't (and haven't previously) put on my car, and it represents an easy upgrade path.
KW Variant 1 / RCE Tarmac 0 / Eibach Pro-Street Coilovers:
TireRack sells these under the Eibach name for cheap. They are made by KW and are, basically, cheaper KW Variant 1's. Variant 1's are not perfect, however, this is the cheapest decent way to replace the stock struts if they've gone bad. If you want performance, go to the Variant 3's, on which KW clearly spent more time doing R&D.
Why do I not recommend Ohlins struts, the only direct-replacement strut for 2005+ STI's? Because they are bound by the same suspension-travel issues of the stock struts. The Ohlins can handle stiffer lowering springs, technically, but all lowering springs are bound by very limited suspension travel and progressive rates. The struts themselves may be good, but the total package remains flawed, unless you insist on staying at the stock ride height. For that, they are the best and only way to go, unless you find a rare-but-superior Prodrive RB320 setup, which vendors like Racecomp can import.
Also worth noting is that 2004 STI's have a variety of decent strut options, such as Tokico D-Specs and Koni "Yellow" inserts in WRX strut housings. Both are good for the price.
Turn-In Concepts SST:
These are outstanding- the best I've felt, in fact. Their drawback is price, since TiC insists on using only the best Swift springs and some other custom parts to improve upon a somewhat flawed AST base design. TiC's coilovers differ from traditional AST dampers by offering drastically more suspension travel and different valving derived from AST's high-end 3-way adjustable racing coilovers.
I recommend them with Vorshlag rear camber plates to optimize the fitment of the rear spring and allow more tire clearance. Front camber plates are not required because the strut mounts are slotted for a ton of camber on the factory bolt, however the stock strut mounts are soft and not optimal.
These coilovers have, for some reason, been marketed towards daily drivers. That's a total misnomer. They're comfortable, yes, but that's because they're versatile, not because they weren't designed for racing use.
The valving is brilliant, especially for higher spring rates. Turn-in Concepts sells these coilovers near with springs at the very lower limits of what works well with the designed valving. They work even better with firmer springs, if your application demands firmer springs. I wouldn't recommend firmer springs for a daily driver, only a track car on R-compound tires. On R-compound tires, 9k front, 7k rear seems to be a good choice.
KW Variant 3's / RCE Tarmac 2's:
These appear to be great too, although I have substantially less experience with them. These are the only other coilovers that I have been able to verify have good valving.
For a daily driver, KW's OE-sized rear spring is superior to RCE's design as it uses the stock mount and allows for plenty of travel. The downside is that this rear spring is slightly progressive, a necessity by design (like all lowering springs), and thus can lead to a minor stability issues while cornering. This drawback is largely negated by a large sway bar.
Like all other coilovers with narrow-diameter rear springs, they work best with camber plates in the rear. The only difference between KW and RCE's coilovers, besides the rear spring (and color), is a minor adjustment to the rebound valving for use with firmer springs.
These coilovers have a reputation for being track coilovers, but that too is a misnomer. They also work well on the street because the valving is good. I see more similarities in KW and TiC's design goals (not their construction, but in damper length and how the valving is tuned) than I see differences.
KW's product allows bump and rebound damping to be adjusted separately. However, I find adjustability to be unnecessary for a product with proper valving, so the extra knobs only create extra work in finding that setting. Racecomp does tell you exactly what settings to run in their manual, thankfully, although I'd recommend sticking closer to their "street" setting to keep rebound forces a little lower. I believe too much rebound resistance in the rear is what causes the wheel lift at an apex, which some folks have encountered. (It is NOT a droop travel issue.)
Zzyzx Coilovers EM Sport:
These coilovers are full of great ideas. Unfortunately, I'm not sure if they're still available.
On paper, the valving of the double-adjustable Koni model looks much better than the single-adjustable. Zzyzx seemed to deal almost exclusively with track/race cars, but I believe these coilovers would work very well with soft spring rates for daily drivers.
Sway bars:
To make a stock STI a whole lot more fun, add a 22mm rear sway bar. I recommend Cusco for one reason, and that is it uses rubber bushings. Every other manufacturer uses urethane, which will require periodic lubrication (every few years, if you're lucky, twice per year if you're not).
Sway bars are largely personal preference. They are one of the most profound changes that can be made to any car because they, not your main springs, are what primarily reduce body roll. Adding a stiffer rear bar will get the car to rotate more, but adding a stiffer front bar is what really cuts down on body roll, making steering inputs feel more immediate.
I recommend Cusco's 22mm front and rear bars for daily drivers, with the rear on stiff. I recommend Whiteline's 24mm bars, with the rear on full stiff, for folks wanting to get a bit more aggressive. I recommend Racecomp's 25mm bars with the rear on soft for those wanting a great street/track option, and Whiteline's 27mm bars for dedicated track cars. The more you lower your car, the stiffer the bars you want, but be aware they substantially cut down on suspension independence and will reduce grip, particularly braking grip, on bumpy roads.
If your roads are not smooth, do not run 27mm bars anywhere, and strongly consider sticking to 24mm or lower. Focus on suspension geometry improvements to compensate for your inevitable body roll because overall, that's your best route.
I have found nothing but understeer when running a larger front bar than rear, even with lots of front camber. On softly sprung cars, particularly those without a lot of negative camber, running a larger rear bar results in a very tossible car with neutral handling.
On R-compound tires, rear wheel lift may be an issue with equal-sized rear bars. Consider lowering the car more as a first response to this, if possible to do safely, and make sure your rear dampers aren't too stiff for rebound. If nothing else works, because your car has lots of grip and is transferring a lot of weight, you may need to downsize the rear sway bar. Your goal should be maximum weight transfer of the rear tires (rear tire touching the ground, but no weight on it) in a steady-state turn, meaning it will lift only on corner entry and stay planted the moment you hit the gas pedal.
Endlinks:
I prefer Hotchkis endlinks for the rear. They rust, badly, but only on the exterior, not on the bearing. They are the only sealed, spherical endlink for the STI I know of, and that makes them the only great choice. Kartboy endlinks will never fail, but require periodic lubrication, and their bushing design deflects a bit.
Geometry:
There are substantial improvements to be made here and are not to be underestimated. Search this site for explanations as I will just give a brief overview of parts I recommend.
Camber plates:These are covered a bit in the coilover talk as they are quite integral to some designs. For the stock struts with stock springs, I recommend RCE "lowering" camber plates. For lowered cars on stock struts, I recommend Ground Control's package. For all coilovers, I recommend Vorshalg plates, front and rear. They use a second bearing to allow rotation of the spring, which you'll appreciate as reduced noise from your springs. The GTWorx camber plates are a decent, cheaper alternative without that second bearing.
The "free caster mod":The rod that holds the front control arm to the rear bushing can be reversed 180 degrees, and since it's off-center, it changes the size of the control arm. Result: your wheels move forward, giving you more caster and an improved weight distribution. This results in heavier steering and more front grip.
An Anti-lift kit:Get GT-Spec or Whiteline and laugh at those who buy Perrin's kit, as Perrin clearly has no idea what their own product does. GT-Spec uses a rubber bushing while Whiteline uses Urethane. Rubber is a better NVH isolator, but Whiteline does offer a reasonably soft urethane version. It's still not as soft as the GT-Spec rubber. Primary effect: reduction of terminal understeer on corner entry / braking.
Whiteline Roll Center Adjuster:Also called a ball joint extender, because that's how it adjusts the roll center. It changes the angle of the front control arm at your ride height by a very small amount. Consider this a free pass for lowering your car 10mm without the geometry-related drawbacks. No, that's not much. There are alternate kits which raise the front roll center much more- too much, in my opinion, unless your car is lowered drastically (over two inches) and you are also running a custom rear subframe to raise the rear roll center. In other words, stick to Whiteline unless you have a very custom, purpose-built race car.
Bushings:There are a few bushings in the car that appear to be worth replacing, and I do not wish to cover them all. The most important, in my opinion, are removing the stock front strut tops (replace with camber plates) and those in the rear lateral links. The rear lateral link bushings are quite soft, and their deflection results directly in delays to tire input.
Additionally, the rear sway bar connects through the rear lateral link, so deflection of the bushing results in a delay in your sway bar engagement. Your front sway bar does not have this delay, so this creates an imbalance in how quickly your tires load up. This results in a strange dynamic since your proportional roll stiffness, front to rear, changes depending on how much body roll the car has at that very moment.
However, I do wish to mention that the soft factory bushings are there to prevent road harshness from entering the cabin as noise. The STI has very little sound insulation, especially at the rear of the car. It is thus prone to increased noise with stiffer bushings in the rear, especially things like rear camber plates. This can be minimized by quiet tires, since tires are the very first layer of insulation of road noise.
Bracing:
90% or more of bracing on the market is cosmetic, or the designer saw an exposed bolt and chose to brace that point because it was easy.
A brace is generally only useful if it rigidly triangulates one or more highly-stressed points. So few products do this that I can only think of three: a replacement front subframe, front fender braces, or rear x-brace. Of those, I've tried two fender braces and the rear x-brace, and I've only noticed obvious results with one.
CarLab X-Brace:is the only brace I've ever felt did anything, in any way, to any car I've worked on. It's effect to handling is minimal, and the improvements to grip are nowhere near the 0.1g claimed by the manufacturer. This brace becomes increasingly important as spring rates go up, however, including those running stiff rear sway bars. This brace also reduces NVH particularly if you have rear window rattles.
Tires:
I won't say anything specific here, just that tires are the most important part of the suspension. They are the first thing you consider when choosing your suspension. Do not run stiff springs/bars on soft tires. Do not run soft springs/bars on stiff tires. You pick tires based on what you want to do, then pick a suspension that works well with your tires. There's a deep science to this, but as the end user, you're left out of it. Just remember not to go too stiff on soft tires nor too soft on stiff tires.