I'm kind of in the same boat - a longtime user of my main upright cabinet, with my next project (if I ever find the time to do it) being a small bartop that I can pick up and take somewhere.
The PC vs. RPi decision is very important. I've got an RPi (version 3) that I set up "just to see" how well it runs MAME and you know what? For most of the types of games I enjoy playing, it's not bad. Better than I was expecting, to be honest, so maybe the low expectations helped.
Using a PC for MAME is still objectively better in every way except for size and power usage, though. The main MAME build that runs on PC is constantly being updated meaning you can be sure you have a path to playing any game that has been successfully emulated (assuming your PC is strong enough.) The Pi, on the other hand, only runs specific versions of MAME, and they're pretty old. So if a game you like wasn't brought into MAME until later, you'll be out of luck. Other games will not look or sound quite right; whether or not you even notice will depend on your level of familiarity with the source material.
Emulation power aside, there is also the availability of help and resources to think about. Tinkering "under the hood" on a Pi can be a major pain if you're not familiar with linux. The online communities are fleshing out more and more with time, but it will be quite a while before the level of community support for MAME on Pi will hold a candle to the years and years of accumulated experience and wisdom associated with running MAME on PC's.
I've decided that I'm willing to accept the limitations of the Pi for my small project, because the tiny size/weight and low power draw are huge advantages for what I'm looking to do. But if I were building a bigger bartop unit where portability was less of an issue, and which would see "regular" use rather than just "occasional" then I would absolutely find a way to shoehorn a small PC in there, to reap all those benefits.
The Ultimarc encoders are still a thing, but if you decide on the Pi route with a single player setup, then there are lower cost options for encoder. Google "zero delay encoder" for example. I use one of these with my Pi and it seems to work just fine.