SOLVED: Transcoding: When it's triggered and when it's not

[bitmap]

PGS, VOB_SUB, HDMV, DVD_SUBS etc... are all image-based subtitles that will (generally) require transcoding. The best way to get around this is to use SRT files. You can use the OpenSubtitles plugin to find SRT files for most media files. There are other programs out there that help you find SRT files for your media as well. The in-between files are ASS/SSA, which sometimes will require transcoding and other times not. It all depends on the client and the complexity of the subtitles.