I just finished doing this. The blue wire from the 296 harness (port 1 out) connects to pin 3 of the D10A db9 connector that is used to update the EFIS. Since this wire must be disconnected when updating the EFIS, I simply crimped a male pin onto the wire and plugged it into the db9 connector. BTW, the 296 must be grounded to the airframe. If you are running the GPS on ship's power, it should already be grounded.
Don't forget, you must also go into the Garmin set-up menu and change it to NMEA in/out.