AVI's are just containers and that is explained a little more here;
http://forum.doom9.org/archive/index.php/t-164633.html
But I see there that VirtualDub is still alive and kicking and that enables you to edit videos.
Mark
If I have an .avi and i want to be able to add or take away audio tracks and subtitles from it, what software would be best for me??
I am already using MKVmerge which allows me to do these things but all the .avi files i use with it get converted to .mkv's. :S

Chowhound
Comic Vine
GameFAQs
GameSpot
Giant Bomb
TechRepublic