I think I've got the exact same issue. Brought it up awhile ago, but no one else mentioned having it too, so thanks! We can now start a support group.

My setup:
Cocktail machine, vertical monitor, U360's connected to USB, all buttons connected through an Ipac.
Issue:
Rotating the list depending on which player moved the stick works great, but it took 2 button presses to start a game.
Upon returning from the game I had to move the joystick twice to get the list to scroll. Starting a game always took two presses.
Disabling "use mapping (controller set detection...)" allows the list and stick to work properly, but of course then the list doesn't flip if the other user wants to take control.
It's like the 1st button press after returning from a game gets sent through the "list flip" process, and then gets eaten. If the list didn't need to be flipped, the key isn't passed on, so I suspect mala isn't saving a variable as to which direction the list is in when launching/returning from a game. (or something like that)
The solution I came up with was to use the button inputs on the U360s instead of the ipac. It's an obvious choice for me anyway, since the u360's have more button inputs than I need, and I can free up an ipac, but at the time this was a PITA to rewire everything.
-jeff!