My CP is setup exactly as you are asking; 5 buttons and a 4 way per player. The button layout is for Asteroids, Space Duel, Gravitar, Space War, Star Castle, etc.
Defender and Stargate are definitely doable. I'm not real good at them, so I can't rave about the controls. I didn't layout the CP with those games in mind, so the reverse button seems a little bit harder to reach than I remember as a kid. I also don't normally reach for inviso or smart bombs, but definitely can.
If you're looking to setup the 5 buttons anyway, I say go for it!
Oh, and when I play Space Invaders, I use buttons for left/right, not the joystick. This setup is great for that too.
(I'm not into the 6 and 7 button fighter games, which made my decision easy)