Iamlitz: not sure you understand that the MKV file is a type of A/V container. What it contains are multiple tracks for the video, audio, and subtitles for the movie. Each of these can be in various formats, and in fact you might have multiple audio tracks with different formats in one MKV container. The PGS subs are a separate track(s) within your MKV containers. The mkvmerge program can “remux” MKV files–that is, extract the tracks from a source MKV and then merge/multiplex them back into a new MKV container. By default, if you do this, it will zlib compress PGS subs. mkvmerge can do all sorts of things when remuxing. E.g., I ripped a Japanese movie and ended up with the English audio track first/default, but this is just commentary, so I don’t want it to be the first audio track and so played by default. Solution: use mkvmerge to remux but tell it to reorder the audio tracks.
It is true that you can extract the tracks, such as the subs track, and stored them separately, but now you have to keep multiple files to have the complete movie. Much easier simply to have mkvmerge quickly create a new MKV file that has the subs compressed, so the entire movie is still in a single file.
