No, water-cooled. Other than being boxer engines, they have little in common with VW 4-cylinder boxers. They are either single or dual overhead cam with some models sporting active valve control timing and distributorless coil-on-plug ignition. Pretty much your modern day powerplant other than engine layout.

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0==WW==0
"…axles of evil…" - george w. bush

 

There is a head gasket issue with the DOHC 2.5L engines (which is in most of those outbacks). The SOHC still has problems too, just not as prevalent.

There is a recall, as Subaru just found out what the problem is. Its an easy fix, and most dealers would probably have this sorted out before the car leaves the lot.

More info:

Actually, I thought the recall affected more engines then just 99-02. I'll go see if I can dig something else up.

https://www.i-club.com/forums/showth...threadid=52492

 

It was actually a coolant problem. The recall "fix" is just to but a bottle of coolant conditioner into your car.