I notice on both of my series two cars there's a small metal tube that was once part of the y-pipe. I followed the broken tube upwards and the metal tube goes to nothing. Can anyone lend insight as to what it is and where it goes?

 

next to the O2 sensor? was a diagnostic port, not used for anything except by the dealer.
a 944 lugnut fits the threads perfectly to cap it off

 

+1

Old fashion emissions port - now obsolete. There is a factory plug/cap you can buy, or probably find something at the hardware store (or apparently a lug nut, lol).

Personally, I weld them shut.