Are your regular punch buttons perhaps wired to the KO button?
No, the game is working fine, all the controls are wired correctly. The dinging noise happens when the opponents throws a punch, not when you throw a punch...plus it is higher pitched than the sound it makes when you press the KO button when it is not powered up.
I just finished pulling and reseating all the ROM chips but that didn't change anything.
Edit: I recorded the audio from the game on both Mame and my arcade machine. At the start of the bout in both recordings I hit the KO button a couple times to show the difference between the correct sound it makes when you hit the KO button without it being powered up, and this weird dinging sound.
To download these MP3 audio files, right click the links and select "Save Target As..."
The first one is from Mame, the entire bout with Vodka Drunkenski; the sounds here are all correct -
http://maxim.skyphix.com/spo_mame.mp3The next one is from the arcade machine, notice all the dinging sounds where the sounds for the opponents punches should be -
http://maxim.skyphix.com/spo_arcade.mp3This one is a short comparison between the correct "KO without powerup" sound (the first pair of dings) and the incorrect dinging sound (the second pair of dings) -
http://maxim.skyphix.com/ko_ding_comparison.mp3This one is the sound that jabs and punches from the opponent are supposed to make, rather than that dinging sound -
http://maxim.skyphix.com/punch_sounds.mp3And this is the correct sound for when you knock the opponents down (the sound of him hitting the canvas), which is also getting replaced with ding sounds on my machine -
http://maxim.skyphix.com/knockdown.mp3