Yikes. So, you likely have an alarm system installed. If you are not using it, carefully remove it. Find where wires were cut to splice in the alarm. Match up the wire colors and use heat sealed butt connectors to reconnect the original wires.
Before you do all of that, pull the lower cowl on the steering wheel. The ignition switch is located about even with the driver's right knee. Typically either the lock tabs are broken making the connection loose, or the entire switch crumbles into a gazillion pieces when you touch it. These are known issues and Ford has a recall on the ignition switch. Do not waste a day or more with Ford, the switch is less than $20 at a local parts store. It takes under 20 minutes to change. If the harness connector has to be changed, it is a bit more than $20 and it might have to be ordered. That will take a little longer because you have to splice wires, or unpin the contacts from the OEM connector and place them in the new one.
If the connector clips are broken, do not give into the urge to use zip ties to keep it fastened tightly. It is an OK temp fix, but the plastic is already brittle and zip tying it is a fire waiting to happen.
The next place to look is the Main Light Switch, especially on a GT. If the switch or connector show heat damage, those need to be replaced. You will also need to trace the wires out to the headlights to see if any melted together and are energizing the horn circuit. This is less likely than the ignition switch being the culprit, but still is a possibility.
I have the EVTM for 93, which is going to be almost the same as a 92 as far as lights and horn go. If you start chasing wires, or need to figure out why something is not working as you remove the alarm, let me know. If you use Facebook, I can send what you need via messenger.
Electrical and electronics are my expertise. I leave the greasy gears and engine internals to others.