AVS Video Converter has the ability to merge a subtitle srt file onto a video file by going into Advanced features and selecting the subtitle track in the Subpicture dropdown. HOWEVER, if your final output is a DVD file, the subtitles will only be merged with the first VOB file that is created in the folder. The remaining VOB files (if any) will NOT have the remaining subtitles from the subtitle srt file merged with them.
For now, my only workaround is to create an AVI file FIRST, and THEN convert that into a DVD file.
Just a heads up on what I have found.
Robert