how to combine .srt file with .avi file?
the output file should have only .avi with embedded subtitles.
you can use MeGUI to mux the subs with the audio and video streams and the result will still be an AVI file (or MKV,MP4,etc if you need).
If you want like hardcode the subs onto the video (permanently embed the video with the subs), then try VirtualDub.
I always just create a text file separately and use VLC media player to see them together - but that's probably not what you're looking for...
@OP, do u want to play this AVI file in CD/DVD player, if yes, then you can try "ConvertXToDVD" software. I've used it, very simple and easy to use s/w.