Yes, I knew you'd have to split subtitles. Also, to avoid quality loss and playback stalls, you'd have to split at keyframes, which is an interesting problem on itself (you could run a x264 pass on the video writing the stats file, which is text too and contains frame types).
I don't see frame-number <-> time conversion as much of an issue since most content is constant framerate anyway so it boils down to just a multiplication. A pissing-off scrambler doesn't have to be perfect anyway.> No. And apparently the development in Matroska demuxing is kinda stalled too, which makes me sad.
It makes me sad too, and the number of different implementations doesn't help (ffmpeg/libavformat, mplayer native, VLC native...)
It's the typical OSS syndrome in action: a lot of implementations, none of which is perfect.