Sounds like you've put a lot of thought into your project so far.

You might want to look at the FAQ -- especially the "What type of build meets my needs?" section.
Not sure if you'll be the first to succeed at "One Cab to Play Them All"
TM, but you're certainly not the first to try.

- Swappable panels expand the possibilities, but remember that you'll need to store them when not in use.
- With more games come more compromises on controls.
a joystick for a flight game that runs on laser disk for which I don't remember the name by now. And if Xybots requires two joystick instead of two sticks that one more.
The laser disk flight game is probably Firefox. It used an analog yoke similar to the one for Star Wars.
http://wiki.arcadecontrols.com/index.php/Joysticks#Analog_JoysticksXybots used an Atari "Twist-to-Turn" joystick, but you can run it using a normal 8-way stick if you remap the buttons like this:
1 2 3
Joy
4 5 6
1 - Turn left
2 - Fire
3 - Turn right
4 - Super-zapper/Start
There are about two dozen games like Ikari Warriors that used a mechanical rotary joystick.
*** Be sure to change the settings for these games as mentioned in the wiki. ***
http://wiki.arcadecontrols.com/index.php/Joysticks#Mechanical_Rotary_Joystick_Games_.28LS-30.2C_Happ_Mechanical_Rotary_Sticks.29There are a number of games that use two sticks like Robotron and Smash TV.
http://wiki.arcadecontrols.com/index.php/Joysticks#Games_with_Dual_Joysticks1) There are many brands of buttons and sticks, what do you recommend and why?
A lot of this is personal preference and can change based on the game you are playing.
- Need rapid fire for Galaga? Leaf-switch buttons are your friend.
- Playing Donkey Kong? Avoid 8-way sticks so Jumpman doesn't get stuck on the ladder when you accidently hit a diagonal.
If you like Japanese-style sticks, Sanwa and Seimitsu make great sticks.
If you like American-style sticks, Happ/IL makes great sticks like the Competition (Happ)/Eurojoystick (IL) or Super (Happ)/Compact (IL) sticks.
2) There are two, four and eight way joysticks. if I add games that in original cabinet have two or four way joysticks do I need those or is eight way precise enough?
You can use a 4-way or 8-way as a 2-way stick, no problem.
Using a 4-way instead of an 8-way gives you no diagonals.
Using an 8-way instead of a 4-way can cause problems with the game logic in games like DK or Pac Man.
3) I have an idea of how to attach the modules but are there examples from those who have actually done this?
Paul's Modular Control Panel -
http://forum.arcadecontrols.com/index.php/topic,68892.0.htmlDoc's Modular MAME -
https://beersmith.com/mame/The Velcro Based Modular Panel
http://wiki.arcadecontrols.com/index.php/Velcro_Based_Modular_Panelwas developed for the Ghost in the Machine build
http://wiki.arcadecontrols.com/index.php/The_Ghost_in_the_Machine4) First I thought that I cover the TV with a frame that leaves the 4:3 are exposed but now I'm thinking that if it's possible I want to show the game in middle and instructions and controls schematic on sides, do you have ideas of how to do this. A launcher that can show a picture around the game and that pictre has the info?
Some people have turned a widescreen TV vertical and used MAME's ability to display bezel and marquee using layout (.LAY) files.
6) I want to launch Mame so that it shows only games that can be played with current controls, how do you recommend I do that? Separate Mame installations of which I will start the one matching the controls?
You should be able to do this using menus in the front end program of your choice. i.e. menus for "360 degree driving games", "Trackball games", "Flight yoke games", etc.
Scott