Forgot to mention that the non-LED version of those ZD Encoders is an "active high" device -- the common is 5v, not ground.
In case you're not sure which wire is ground, look at the underside of the ZD encoder -- all the wires/traces on the outside are tied together so that's ground 5v.

. . .
EDIT: Melvinbates mentions here that the ZD has 5v on the outside plane.
Since these buttons and joysticks come as a "2-player set" and with their own I/O card, if I wanted to do a 4-player arcade - can I just use two of these "2-player sets" plug in these 2 I/O cards to the raspberry pi and key board map to make this a 4-player set and not use the Ipac 4?
The easyget 2-player LED kit pictures on Amazon show one LED ZD Encoder per player.
Configuring the software for four single-player LED ZD Encoders (gamepad-style encoders) will probably be more difficult/confusing than configuring it for one IPac4. (hybrid keyboard/gamepad/mouse-style encoder)
The other considerations are:
1. Can the RasPi handle four USB inputs?
If not, you'll need a powered hub since IIRC the USB spec for un-powered hubs is 100mA/port. (see below)
2. How much current will the LED ZD Encoders draw to light all those LED buttons @ ~20mA per button?
8 buttons = Coin + Start for all four players
12 buttons = P1 + P2 player buttons (6 each)
8 buttons = P3 + P4 player buttons (4 each)
2 buttons = Exit + Pause
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30 buttons * 20 mA/button = 600 mA + whatever the encoder part of each PCB draws
IIRC the USB spec for motherboard connections is 500mA. (without a powered hub)
Scott