If you're interested in working with difficult multimedia files on Linux, I whole-heartedly recommend trying out the Matroska file format. It would have been even easier than using that simple mencoder line, and the format supports as many different video, audio and subtitle tracks as you like. It supports lots of different formats together, so for example you can encode your DVDs with high-quality H.264 video and Ogg Vorbis audio and they will play together with no problems whatsoever, which is more than I could say for AVI!

You can do some cool tricks with the format too. Imagine if you had a foreign film with both dubbing and subtitling in English (or whatever is your preferred language). You can easily store both audio tracks and the subtitle along with the video in a single file, so maybe if you're feeling lazy and you can't be bothered to read subtitles, you can just select the dub track, but then if you wanted a more authentic experience you could use the subtitles and the original audio instead.

Easy to install on Arch, just pacman -S mkvtoolnix; /usr/bin/mkvmerge for the CLI version and /usr/bin/mmg for the GUI.