I hacked a $7 gamepad just for the learning experience.
Ended up using it in a 1 player cab that had a 4-way stick, 2 action buttons, 1 & 2 player buttons, coin, & escape.
There is a tutorial on here somewhere about doing a cheap gamepad hack.
MALA automatically launches on bootup, games can be selected and exited, & MALA shuts down the PC on exit.
No keyboard hooked up to the cab unless something needs tweaked.
(MAME is the only emulator on the cab)
Unfortuneatly, the gamepad I used required you to press an analogue/digital mode button to use the d-pad and I didn't have enough inputs without using it.
So I had to add another button on top the cab for that and it has to be pressed every time the machine is turned on.

If I had it to do over again, I'd still hacked the pad for a learning experience, but I'd used an eco-wiz in the cab:
http://groovygamegear.com/webstore/index.php?main_page=product_info&cPath=76_80&products_id=200EDIT: Here's the link to the gamepad hack thread:
http://forum.arcadecontrols.com/index.php?topic=84548.0