Is it possible to give the STi 400-500 hp? How much would it cost? I know its already turbo charged.

yes there is bunch of ways rebuilt for more boost bigger turbo n20 bigger better I/C intake exhaust downpipe. the STI is highly tuned so you'll need to work to get more power but you can get them well over 500 if you got the $$$

I got like 10,000. What could I do with that? I'm looking for some simple things to get to like 350-400 HP.

You could do it with that much money definately. You should focus mainly on engine management, the stock ECU is kinda loopy. Also you should definately go for a parallel fuel rail conversion.

yeah you could probably get 450-500hp with $10,000 but would the stock tranny and gears and axles and brakes handle this much power???

I would think you would have to upgrade the clutch. From what I've read, the clutch is the weak point of the drivetrain and won't take much over 400 HP.