What should I do with my Subaru with 280,000 miles and cracked head gasket?

2 choices: spend a LOT of money to rebuild it, or use that money to get a better car- I suggest saving the money and selling the Subaru for parts- unless you get a REALLY good mechanic to do the engine work, with everything else under the hood NEW- (sound expensive yet?) you will just continue to have problems-

Honestly, at 280,00 miles and the fact that it's going on 16 years old, I would sell the car for whatever you can get and tell them the truth about its condition. Someone who is willing to restore the car or just sell it for parts. Sounds like you are saying that the heads are actually cracked so it's not just the gaskets. From what I've read on the car gurus feeds it's not advised to try and rebuild a boxer engine, so, you're talking about a brand new engine ......I'd rather place this investment in a brand new or better yet two or three years old lease return. Buying a new car these days is really not a good return on your investment.... You can save a lot of money and get a very nice certified pre-owned car with a warranty. Good luck.