I like the second one better, and if you do that you may not need the 4th button on the top row. You could use the bottom row of 3 plus that "run" button for neogeo games.
I'm guessing your planning on n64 emulation (super smash brothers!) or something in addition to mame. If you're only running Mame though, it only needs a max of 4 buttons for players 3 and 4 plus additional start buttons for the Dungeons and Dragons games. That will save you some space on the cp.
You may want to scrap the labeling of players 1, 2, 3, and 4. Some games like TMNT have it so Player 1 is always the furthest left, though I guess you chould change that by remapping the coin buttons within mame for that individual game. The Simpsons is like that as well (another konami game).
I like the color separation, but I have an additional idea/suggestion. Perhaps in photoshop you could enlarge each players graphic (mario) and make it transparent, and saturated with that players color. So for player1 there would be a large reddish transparent mario filling that section of the cp. Just throwing that idea in for you.
Looks good. -Jay