In subler the dts > dolby pro logic II works fine and is in sync. But I want to have an AC3 track so I must convert the dts to ac3 and 2 channel using another program as I noticed subler not having this feature. I discovered iFlicks so I am trying that out now.
Version 3.1.4 (3.1.4) according to the About... window. I have it set for pass-through on the video and to remux the audio from DTS to AC3 (5.1) along with the 2-channel stereo (for iPad viewing).
I have been using subler since encountering this is issue and it works fine in mountain lion. It just doesn't have DTS to AC3 conversion from what I see. So if your mkv only has DTS audio you can only convert it to AAC 2 channel / Dolby Prologic 2.