I think hardcodding would only get in the way - not as pretty or cuztomizable subs and you won't be able to purge them for screencapping purposes if you ever need that. Oh, and obviously all that time and effort wasted in re-encodng.
If your subtitles are in SAMI format, I know it is totally independent from your video file. But since you have mkv (contains subtitles within), it is most likely go away when you do the conversion. I would look into ways to export that subtitle to .smi, there is gotta be a way to do that. As for a media player with great interface and least amount of hassle, my standard suggestion has been KMP for some time, except I will most likely be migrating to DAUM Pot player; not sure they have an english version for it though.