Emission Failure!! Help?

So here's some irony for you. I lived in Ohio most of my life, where they've done emissions testing possibly longer than most other states. I moved to Az a few years ago, who also of course does emissions testing. Only to find out that NOW, Oh no longer does the testing... Grrrr.. Of course that was not my reason of moving, but a semi-useless intro to this dilema..

Took my bus (1995 Mercury Villager, affectionately called the 'bus') to get it's emission inspection, and as you guessed by the title, it failed (would I write to say it passed, hehe).

Here's the pertinant data:

Oxides of Nitrogen (NOX) in grams/mile mine: 3.37 standard: 3.00 result FAIL
Pressure test: FAIL

Now the NOX from what I read, deals with the "UFO" (that is round and dimensionlly fairly flat) disc (1 of 2) that sit on top of the engine, upper left (drivers side) conviently far enough back to be under the body of the car (you know, where the windshield meets the engine compartment) that you cannot easily get to the stupid thing. It's called an EGR valve incidentally.

The Pressure test is where they hook up a line where your gas cap goes, "push in 1.25-1.5 pounds of pressure while clipping off the fuel line in the engine compartment. It is supposed to apparently keep this steady 1.5 or whatever pounds of pressure.

So first off, anyone familiar with these failures and any "quick" DIY fixes, please chime in.

My state offers a "retro kit", that I have to qualify for (by age of vehicle), and I'm told my bus this year meets the criteria for.
Paper the place gave me doesn't specify what exactly they change out and replace, but he did say he knows they replace the catalytic converter. It would cost me $150 bucks, the state chips in $550, and anything over would be on me. Hoping there wouldn't be anything over. Does this sound like something I should do? The bus has 249k miles on it atm (2nd engine), having the engine replaced about 5 years ago due to hitting something on the road which damaged the oilpan (while driving :( ).

While we like the bus, sinking a ton of money into it, well, we're trying to avoid that. It's a backup vehicle, and hopefully a ride to keep the miles down on other cars. The $150 mentioned above will not, as far as I know, cover the pressure part, which is fuel/fuel line related (unless the retro kit replaces fuel lines??), so that would be additional.

I just licked a drivers door problem (see other Villager post from me) and was extatic about that.. But now with this failure and the rear blower issue occured while the bus was sitting... Well, I've had better days... Any thoughts on these failures would be greatly appreciated. Thanks!

Rooster

hello exit was/is your check engine light on?when they pressure test gas tanks they pinch off the fuel return line.you need to check all hoses for
cracks & to make sure they are thight.also being as old as the car is
check the fuel filler neck.i had one with a pin hole in it causing it to fail pressure test.

Nope, no lights on at all. :(
As far as cracks in the hoses, wouldnt' that mean there'd be moisture (you know, gas seeping through the hoses) if there were cracks? Cuz pretty much everything udner the hood is bone-dry.