I currently have an 1996 gary fisher mtn bike, it had a square bottom bracket in it which has been asking to be replaced for a while now. The cranks could use replacing as well the cogs so I was pondering get a new crank set entirely and was wondering how bad it would be to put an external bearing bottom bracket and crank set in place of the current square tapered one. I read a bit and it appears as if all the dimensions are fine , the only possible problem would be if the frame wasn't machined well enough that the left and right shell surfaces weren't square, does anyone have any insight as to how important this really is? problematic?

The bottom bracket shell needs to be properly faced for any install and if you are going with this upgrade route it would be prudent to have this done when you get the new bb and cranks.

A square taper bb will be more forgiving than an external bb when it comes to tolerances so this should be checked... decent quality bicycles tend to be properly finished but there are exceptions.