How do you remove the trim panel that sits between the headlight cover and the front bumper? It looks like it's held in place by some rubber plugs.

You just push the rubber plugs back through from the inside.

unless any of the rubber plugs have been replaced with bolts and nuts.

Is each side held in with 2 or 3 grommets ?

3 each 2 on the trunk side, 1 on the fender well side. .
Try not to break them as they are probably brittle if they are the real ones. . . If you do need new ones, I think 914 Rubber has some. . otherwise, using a plain rubber grommet , the kind with a hole in the center will work. .
You'll probably learn a few new swear word when you replace them. . .

Do they push in from the headlight cavity or from the trunk and fender side?

Push in towards the middle from the trunk and fender sides.
They stay attached to the eyebrow piece.

The eyebrow you want to remove has (2) grommets on the inside of the trunk area and (1) on the outside fender end. The (3) grommets are attached to the eyebrow with the grommet tit sticking in the hole showing on the above photo. Turn your headlights in the up position and gently lift the eyebrow out.
BTW: I installed an emergency wire from the hood latch with a pull handle under the eyebrow in case the cable breaks on the pull lever inside the car. Call it a safety latch if the hood cable breaks. Hidden under my eyebrow is a miniature (yellow) 914 carved handle attached to the wire that no one will ever see unless it's needed.
Tom

That's very creative TJB/914! Thank you all for your responses. I take it that the installation is just the reverse...push the rubber tit into the corresponding hole?