How do I embed Google Web Fonts into an SVG?

You embed fonts in CSS by using base64 encoding. You can apply styles in SVG documents similar to CSS by using a <style /> element. So if you have a WOFF font, you'd embed it like this:

<style>
@font-face {
    font-family: "Sample font";
    src: url("data:application/font-woff;charset=utf-8;base64,...");
}
</style>

Where ... is the base64 encoded font data.

You can find examples of this by looking at Typekit's stylesheets. I'm not sure if the mime type of font/woff is correct, as I've also seen people claim that it should be application/font-woff. Though font/woff, font/truetype, font/opentype, etc. seem to be more popular.

Alternatively, you could actually take the SVG version of the web font and embed the SVG font's description markup inside of your document (though browser support is still very limited as Luke notes in the comments).

However, you should also be able to link to an external font according to the SVG specification. That would seem to be the best solution if you're gonna have multiple SVG documents referencing that font.

A <defs> section like

<defs>
  <style type="text/css">@import url(http://fonts.googleapis.com/css?family=Indie+Flower);</style>
</defs>

works.

This may be over simplifying, but have you considered downloading the font as a zip file from google and then letting Illustrator convert it as needed into your SVG file output?

This is only theoretical as I haven't tried this yet, but in theory would seem to work.

Add the following after <desc> tag

<defs>
<style type="text/css">@import url('http://fonts.googleapis.com/css?family=Lobster|Fontdiner+Swanky|Crafty+Girls|Pacifico|Satisfy|Gloria+Hallelujah|Bangers|Audiowide|Sacramento');</style>
</defs>