sorry one last question, if I go down the pc route, is it possible to control windows with the stick and buttons? I don't want the hassle of installing a track ball or modifying the cab, and I don't want a keyboard and mouse hanging out of it.
Also is it possible to wire the power switch of the mobo to an arcade button (I have an unused one on the side of the cab)
thanks
Absolutely better with PC! I just bought a brand new RPi3 and I'm using RetroPie on it. SOOOO slow for MAME! Only usable on NES/SNES etc.
There are a lot of small PC's available, although maybe not for just $50, but you can find them. But I experienced slowdowns on a P4 on "newer" MAME games, and would recommend something beefier, Core2Duo -> Core i3/i5 and a decent graphics card. Slowdowns ruins the whole experience.
While it is possible to control Windows with the stick and buttons, I don't see why you'd want to. You could buy a tiny RF keyboard/mouse combo and have the receiver plugged into the motherboard for the times you'd need it, or VNC from another computer. When you have everything set up the way you want it, you re-shell Windows so you go straight to your front-end (HyperSpin or whatever).
Starting the computer with an arcade button? No problem at all! The power button in a computer chassis is connected to two pins on your motherboard, cut the wires behind the button, and solder them/crimp to the arcade button - done!