I considered this also. On of the better options would be the Blaze Twin Shock. It requires two PS inputs, and gives 2 digital joysticks and 8 buttons per player plus function keys. Electronics Boutique has them for $17.99. Two of them would be less than half the price of a hot-rod and much less effort than building a controller.
OTOH, I decided to pass on it because the buttons don't have the same firm spring as arcade controls, and the joystick, while prolly better than a flight stick is nothing like even a cheap arcade joystick, much less one of the better Happ (Super, competition) units.
I will spend three times as much in money and 20 to 30 times as much in time, but this controller would not be what I ultimately want!
If you are considering this, try to go in the store and test one out of the box before you decide. You might think it's a great idea, or you might change your mind really quick.