What kinda subtitle file are you using?
Here are couple old threads about the same issue:
viewtopic.php?t=27685&highlight=
viewtopic.php?t=27252&highlight=
In summary one could say that if your subtitles is in .idx & .sub format the subtitles quality depends on the movie files resolution/quality. I doubt its been fixed in 0.8.6a so guess we just have to wait.
edit:
Hmm it seems that 0.8.6a did make one of my .mkv files subtitles bit smoother with default settings. I previously had 0.8.6, but cant say for sure.