I agree with Dave_K (nice avatar, Dave!) molex is definately the way to go. Least amount of headache.
Or, and this is an idea that delta88 and I are messing around with... you know those boxes that allow you to hook one printer to 3-5 computers, or 3-5 printers to one computer? well, if you pick up one of those that supports at least two to one, you could panel-mount the face of it just under your control panel... or just set it inside where you've got your consoles (mine are inside my coin doors, on custom shelves...) and whenever you want to play a different console, you just turn the AB knob... :-)
if you were doing Dreamcast and Saturn, you could get by with (1) full-parallel 25-pin A-B to C box for two players, because the most conductors you'd need is 12 (6 buttons, start button, 4 d-pad directions and a common ground plane on the MadCatz dreampad) and a FULL PARALLEL DB-25 switch box has 24 switchable lines (whereas a serial DB-25 switchbox only has 12...weird, huh) and pin 1 is common. So you could run pins 2-13 for player 1, and pins 14-25 for player 2, and be all set.
But with Playstation, you'd prob'ly need a separate switchbox for each player, cuz you've got 16-conductors (4 d-pad, 4 shoulder buttons, 4 fire buttons, select, start, and I'm pretty sure two separate grounds)
one more reason why Dreamcast rules, but that's for another place and time.
Keep it real! Let me know if you need help finding any of this stuff!
I just think having two many controllers constantly hooked up in parallel may eventually cause problems, even if you get them working at first, because of all the extra wire involved, that power ends up going into... could cause too much of a draw on the system being used at the time... if this doesn't make sense to you, I'm sorry, cuz I'm free-associating. Ask me later. --dave
p.s.- good choice on MadCatz dreampads... weren't they the easiest thing to work with? --djb