In traditional Lotus Notes development, Sub-Forms are used extensively to share code and to foster consistency throughout an application.

As I understand that XPages does not support Sub-Forms, what is the equivalent functionality for Sub-Forms, what is the bast approach for migration an application that contains a great many Sub-forms to take advantage of XPages?

You are correct. XPages does not support sub-forms as far as I know. The equivalent to the sub form is the “custom Control”.
However, while the custom control can be treated as a subform – just like an XPage can be treated as a form – that limits them somewhat as both the xpage and the custom control are improvements.

For example a custom control can be used more then once on an XPage. It can take parameters..

I’m certainly not an expert on migrating applications, but I personally think that the best approach is to slowly build up the application using XPages tools and eventually “migrate” to the Xpages version. While this does seem like a “rip and replace” the silver lining is you can do this without touching your existing code – the XPage code could even be in a seperate db with no data. Also, the XPage code would then run in the Notes client. So you would end up with one code source that ran on web and client.

Custom controls and themes/css are the best way to go for code sharing and to gain consistancy throughout the application.