LOL.. great job figuring out how to turn subs on/off..However, it has nothing to do with this issue.
If you had actually read this thread - the problem is subs disappearing after 10 seconds of playback on 1280x720 titles. The issue doesn't exist on SD DVDs. This is something Apple will have to fix in the future ATV2 firmware.
P.S. hint - you don't need iOS Remote app to toggle subs, you can do the same via ATV menus.
I haven't noticed subtitles disappear yet
BTW: to select subtitles track OR swich them on/off you don't have to go through any menu or do magic with chapters and Remote app. Just press and hold the middle remote button ("OK") WHILE playing a subtitled movie.