Subpages menu on sidebar plus widgets

If I’m understainding you correctly, you’ve hardcoded the wp_list_pages() function in to the widgetized area of the theme’s sidebar, and then, when you add a widget using WordPress’ back end Appearance->Widgets then you no longer see the output of the wp_list_pages() function?

If that’s the case, then I think we’ve found your problem. If code exists in a template’s widgetized area it will only display if no widgets have been assigned to the area. As soon as a widget is assigned it will override any code that is inside the widgetized area. Think of it as being a kind of built-in if statement that says

if ( no widgets ) {
    Do the code I have written here;
} else {
    Do the widget code;
}

Probably your best bet would be to create a custom menu under Appearance->Menus and then use the built-in Custom Menu widget that WordPress provides already.