it would be really nice to configure the other buttons on the IPaq (player 1&2 buttons 7-8) to do other things like ESC and pause for the ever so important bathroom / smoke / beer breaks 
I would use the shift function but I cant figure it out. any help would be very greatfull and thanks in advance for all the help as I am sure htis question has been asked a few times.
Don't know about using USB mode. Never saw the need for it myself

As far as re-mapping goes - just re-map what you want to change in MAME (i.e. press TAB and re-map from there). I'd only muck about with re-programming the IPAC if the default setting REALLY isn't working for you.
The shift function of the IPAC is pretty straightforward. With the jumper set to MAME, 1p start is the "shift" key. Just hold it down and press the second button (listed in the IPAC docs) for the required combo. For example, by default, [1p start] + [1p left] = [ENTER].
You'll figure it out
