4-Player Versatile Multi-Console Arcade Stick Project (My First Build)

[JamesKarlMarxwell]

First, hey all! Glad to join this board, and I hope to be a regular contributor in the future!

Now on to business. I've begun designing an arcade stick for my gaming setup. I've been searching around, and my requirements seem to be more demanding than most of what people have done so far.
Here's the initial requirements:

- default 4-player arcade interface, switchable to 2-player twin stick configuration
- outputs for multiple platforms, including PC, PS2, Saturn, and Dreamcast
- both analog and digital functionality for the sticks; most likely digital in 4-player mode and analog in 2-player mode

Since analog sticks seem to either be flimsy, expensive, or flight sticks, I think my sticks will need to be custom built or hacked.
My options here are:
1. take apart some cheap flight sticks, switch the handles to ball-top sticks
2. find a way to attach 10k pots to digital sticks
3. build the sticks from scratch, using 2-axis pots

Right now I'm leaning towards option 3. It seems like it may be the most effective and cost-efficient solution. I could even add switches for digital mode if my simulated digital doesn't feel natural enough. Does anyone have any experience with this, and have any pointers they could give me? My overall biggest concern is that my home made joysticks won't be sturdy enough for arcade gaming.

My next hurdle will be the electronics. There are enough boards that give a configurable PC interface, but I want to use this for console gaming as well. Now, I could always hack a bunch of controllers and be stuck with a mess of wires and boards, but a custom microcontroller would be a more elegant all-in-one solution. This could allow me to autodetect which platform is being used, as well as to easily switch between analog and digital mode. Right now I'm thinking Arduino for a simple low-cost micro.
I know that there are a zillion Arduino libraries for PC game pads, but I have yet to come across one for console controllers. Although I have had exposure to microcontroller programming, I am not yet familiar with Arduino. I know there are a ton of hacks for interfacing a console controller to a PC/robot/display, would it be feasible to use their input code to determine the correct outputs for each particular controller? Of course, dedicated game console controller I/O libraries would be my preferred solution. Also, could I send digital output directly from the board to the console, or will I need some external logic?

As this is my first controller build, I would appreciate any advice or feedback some of you veterans could give me!
Just don't tell me it can't be done, or to start with something simpler. I will take it personally