I am replying to this old topic because this is the only hit you get when you Google "Octolapse" and "WARNING: Subprocess output does not appear to be encoded as UTF-8".
I had this same issue and a fresh install of Python 3 resolved it for me. Use my steps at your own risk - I'm definitely a Raspberry Pi novice.
The steps I took were:
Find all installed python versions (run python --version and python3 --version)
Run the standard uninstall for the python versions: sudo apt-get remove pythonX.X (where X.X are the versions you found)
Run autoremove to get rid of any 'minimal' files: sudo apt autoremove
Make sure updates information is up-to-date: sudo apt-get update