I've successfully configured a notebook PC inside my JAMMA MAME cabinet. More challenges than a PC, but it can be done.
To output the VGA signal to the 15k arcade monitor, I used a GBS-8100 board to downscale the VGA output. I still have a problem I can't figure out - randomly, the monitor will drop the red color and the monitor shows the game with the color missing. Just as random, the color will come back after a few minutes. I've determined it's the 8100 board and not the monitor or laptop that's doing this. I've tried two 8100 boards and they both do the same thing, so I have no idea how to fix.
To turn the laptop on / off, I leave the laptop in standby mode and configured it to awake on the click of a mouse button. The I wired up an old mouse with a switch soldered to one the of mouse buttons so a press of the switch will simulate a mouse click, which will wake up the laptop. I then set the O/S on wake up to fire off my MAME frontend, Hyperspin. To put the laptop to sleep, I configured Hyperspin on power off to put the laptop in suspend mode.
There ya go, no hacking your laptop's power button. If only I could figure out the color problem on the GBS-8100.