Using VLC 0.8.6h Janus (Intel) on Mac OS X 10.4.11, when I manually edit the vlcrc file by putting in the line
freetype-color=0xFFFF99
then VLC correctly displays the subtitles in pale yellow (my preferred color).
But whenever I go to Preferences / Video / Subtitles/OSD / Text renderer, the Text default color field is empty and when I click OK, the freetype-color setting gets purged and all subtitles display in black. I have to manually edit the vlcrc file to fix it again.