Ideally a cabinet with a 19" or 25" display should have a control panel the same width as the cabinet. Only newer "Deluxe" and or 4 player cabinets tended to have overhanging panels.
I disagree with your definition of "ideally", because it's all personal taste and feel.

My up-and-coming cabinet had a CP pretty much the width of the cabinet, but I figured it to be too narrow for two people to stand next to each other comfortably, so I now have it over hanging on the sides quite a bit.
My advice to anyone who asks these kinds of questions:
Build a full scale mock-up of your control panel (even if it's jsut using carboard and paper) and just see what FEELS comfortable to you. See how far your hand has to extend to get to the joysticks. See how naturally your fingers hit the buttons. That kind of thing...