You need to map the P1 Directions in-game so that EITHER joystick will activate it.
Hit tab
Go to P1 Up and hit enter, then hit Joy1 Up
Hit enter again immediately, and then hit Joy2 Up
The display should say P1 Up = Joy1 Up OR Joy2 Up
(Joy1 Up and Joy2 Up will be whatever key is bound to Up on that joystick)
Do this same procedure for the other three directions