These subs appear to be a direct VOBsubs (bitmap DVD subs) to SRT (basic text subs) conversion/OCR of the official DVD release's Dialogue Only (no signs, chalkboard doodles or background chatter) track. The original VOBsubs I believe were ripped by Arigatou and converted by an anoymous OpenSubtitles.org user to SRT for modern usage.
Place them in the same folder as https://nyaa.iss.one/view/1172007 and you'll have a more tolerable, stylable, non-pixelated sub track to watch with the current highest quality video rip.
PS:
I would alternatively recommend watching the original hardsubbed TV fansub at https://nyaa.iss.one/view/106218 instead of using these subs at all.
While the video quality back then was not great by today's standards, the fansub was terrific, typeset with great care, and was simply better than the official release subs, however being relessed only in a hardsub, they cannot be transferred to a higher quality video source without recreating them from scratch (maybe one day).
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