Are .smi or .srt files more compatible with the S3?
This question is probably opinion-based. 

I'm not familiar with the trend in subtitles, but I use them a lot since I am hard-of-hearing. Most of the subtitles I get from SubScene are .srt files. Occassionally, I'll encounter a .sub and .idx combo, but RARELY an .smi.

A lot of media players support .srt; a lot others also support other formats. My guess on the app that you found which supports only .smi - which you didn't even mention its name - is that it may have been a niche app to play videos that have .smi subs. There may have been no other app that played .smi when it was made. I am just speculating.

But one thing for sure, .srt is not going away any time soon.