There is virtually no difference in CPU overhead during playback between XBMC and Mplayer (especially when hardware decoding is in use) and subtitles have never been an issue here with XBMC. Granted if I use sub titles they would be in English. XBMC also has a full set of picture controls as well for brightness and contrast.
I have yet to get XBMC to play with any non-latin characters. I guess I need to get my hands on a full unicode font, as it does not do any font substitution at all.