In Handbrake there is an option to optimize video files for the web so that they play better online. Does mencoder have an option like that? I'm wondering if I should convert a file using handbrake after using mencoder to add subtitles, but am worried about further loss of video quality.
I would go with a mov container instead of an avi as you can stream that without any magic and play without downloading the whole thing. AVI is funny about needing the last bit first...