I had thought that git-annex and git submodules couldn't mix. However, looking at it again, it turned out to be possible to use git-annex quite sanely in a submodule, with just a little tweaking of how git normally configures the repository. Details of this still experimental feature are in submodules.

There is still some work to be done to make git-annex work with submodules in repositories on filesystems that don't support symlinks.