Well, I can certainly do something like this. Only issue is generally the newer consoles (Xbox, 360, PS3, Wii) due to a lack of documentation on how their controllers work. Memory card support will also be questionable, but if somebody can dig up specs, there's no reason it can't be done.
Unfortunately, I don't have the time right now.
FYI, in small quantity (a dozen or thereabouts) hardware like this usually ends up costing 3 figures when all is said and done.
As far as using SD cards, that should be doable. MMC has better public docs, but SD can be made to work with just about any micro, too. You'd need a larger micro in terms of code size and RAM to handle the FAT filesystem on a memory card, but even really big micros aren't that expensive.