You can wire the switches in parallel like Frank Drebin's diagram above, but not in series like this:
encoder _______/ _______/ _____ ground
(both switches need to be closed to connect the encoder input to ground)
You can also connect the switches like the "MAME Button" and "Pinball Button" switches in this example.

You probably have signal and ground reversed on one of the switches.

There is no polarity to microswitches, the contacts are either open (not touching) or closed (touching).
Swapping tabs used for "signal" (encoder input) and ground will not make any difference when wiring two switches in parallel like Frank Drebin's diagram above.
Swapping tabs of the "Pinball Button" switch in the diagram above will make no difference.
The only place where swapping tabs will make a difference is with the "MAME Button" switch since the NC tab connects the encoder input to the "Pinball Button" NO tab -- "MAME Button" would work, but "Pinball Button" would not.
Probablly just best to wire them seperate huh?
That works, too.

Scott