Had the same problem and I think I figured it out. It seems that the PS3MS GUI v1.04 doesn't recognise that you are altering the ASS font settings (0.1 | 1 | 1 | 10 ). You have to alter them manually. In order to do so leave the "ASS/SSA Subtitles" box checked. Next open up your mencoder configuration file (I'm using ubuntu so it's /home/"user"/.mplayer/mencoder.conf [if there's no mencoder.conf file simply create one]). Here you can enter all options. Don't forget to save afterwards
I needed only the two below. For more use the mencoder man page
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Beware: If you enter undefined values like subpos=110 the PS3 will throw the Corrupted data error.
Hope this will work for you as it worked for me