I finally finished modifying the Java grammar to faithfully represent my changes that enable subtyping for annotations. I also added a description of the extended API I had to develop to allow reflection for annotations with subtyping. I have also decided to remove the treatment for local variable annotations, originally implemented in LAPT-javac, from xajavac now that the JSR 308 proposal provides a different format.
All of this information, along with the binaries for the modified compiler and the API, is available on the xajavac website.
Now I should write a more formal tech report about this, I should contact Michael Ernst of the JSR 308: Annotations on Types project, and I should modify the code I wrote to for my MS thesis to take advantage of annotations with subtyping.