Recently the AC in my 1995 Civic started blowing only half-cold when I used either the fresh air or recirculation button but blows cold enough when I hit neither. What does that mean?

The AC system is probably low on refrigerant.

OK--but why does it blow colder when neither fresh air or recirculation button is hit?

I don't know but I don't think there is a setting in between fresh air an recirc. It is one or the other. Since you are dumping the car what are your worries? Fixing the AC system would probably cost more than you can sell the car for. Having a good shop check the refrigerant levels is the place to start. A re-charge may get you through the summer.