What I meant was that you should try connecting to the Subsonic demo server to see if you still get the same behavior.
I'm merely suggesting that it might be a good first step to try and determine if the problem is specific to the phone app or the server you're connecting to. If you connect to
http://subsonic.org/demo/index.viewand the symptoms you're having disappear, then you can focus on your server as being the source of the problem.
On the other hand if you experience the same problems on the demo server, then you need to work with the app developer to see if you can identify and resolve the problem.
My initial guess is that your issue is most likely server side related to wMA transcoding, but I'd still start with verifying that the server is the issue by connecting to the reference server and eliminating the iSub app as the problem.