While i was driving all of the sudden my 98RS started to sputter. I stopped turned it off and took a look. I started it again and noticed that from the spark plug wires it was arcing over to the throttle body cable. Now how do i go about addressing this problem? New wires, new cap, ect?
Here is a colorful picture of the problem

 

New wires should fix that problem. I must say.. that particular wire seems to be bent at a pretty mean angle to route it under the throttle cable. It could have caused the plug wire insulator to fail prematurely and cause this problem. See if there is a better way to route the new wire, if you end up changing them.

I recently changed out my wires on my 98 STi and I still have the old ones. They are in good shape. If brand new ones turn out to be too expensive, I can send you these. Just cover the cost of shipping.

Also, this is a good find on your part. Most people would blame the fuel system or something else. I bought a perfectly good MR2 off a guy a few years back for $700 because it "ran like $#!t" and he did everything he could to find out why. The $700 was just to cover the money he spent on parts and labor trying to fix the problem. A couple days after I bought it, I popped the engine compartment cover at night, and noticed that every plug wire was arcing to the block. $40 and some new plug wires the next day, and that car ran great for a year....until I blew up the tranny. I then sold the car for $800