I had this EXACT same problem with one of these encoders. Ran around a while trying to get it to work and then found this thread. A PCI to USB card works like a charm for me too. I, too, am using a Dell but I tried it on two other computers (not Dell) and it did the EXACT same thing. One thing I also noticed that I don't think was mentioned in this thread......When I had the encoder plugged in and in proper working status, if I soft-rebooted the computer it would install fine. It was only when cold booting from an off state that it would install showing that Chinese font in the devices window and not work just like you guys described.
Another thing I can add is that I DID get it to work when it installed the "wrong" way by jumpering the "mode" connector and leaving it jumpered. When booting up that way, it would still install "wrong"....ie Chinese font and not as the correct "Gamepad".....but in the game controller settings, all of the functions would register as button presses (versus no response at all without that jumper). This way, I could use it by mapping my Mame controls accordingly. It wasn't too convenient to leave it that way because with controller mapping set for that, when I soft re-booted the machine or unplugged and re-plugged the encoder, then it would install "correctly" and my controller mapping wouldn't work. But it could have been a feasible work around if I hadn't found a better option.
I picked up a PCI to USB card for $5 at a used computer store locally and that did the trick. Clearly the problem is in the way the USB controller on the motherboards interacts with the encoder from a cold start. I think the Bios registers it as a keyboard then when Windows loads it goes with that and for some reason doesn't see the "gamepad" part of the encoder and install accordingly. But when you soft re-boot....the encoder never powers off and when the computer reboots the bios doesn't see it as a keyboard because the encoder is already booted up itself into the "gamepad mode"....so then the proper "Gamepad" part of the encoder is not "pre-empted" from Windows by the keyboard function of the device registered in the bios.
That's my best guess. Maybe I'm way off, but it's the only thing that sounds logical to me. What's more logical than all of that though, is that the designer/manufacturer/coders of this device are morons....or at least whacky engineers who can understand a bunch of ones and zeros but can't tie their shoes. Cheap Chinese crap. Hope this info helps someone else as much as the previous posts ont his thread helped me. Saved me from spending more $ on another encoder and junking the one I already have.
Thanks so much for this thread!
Dyno-Mike in Albuquerque, NM