I've got two plumbing issue that I might try to tackle in the next few days and am looking for some advice. A photo of this is below, but here they are broken out:

1) there is a corroding galvanized T off of the main flexible water pipe coming in the house
2) the outside faucets are plumbed before the pressure regulator, so they have high pressure (~140psi)

What is the best way to correct both based on the photo below?

https://www.dropbox.com/s/s6t8yn5t3y...in%20small.jpg (I would have posted this in-line but it keeps complaining it's invalid)

I'm trying to understand the best way to modify the connections.

Thanks for your help!