The only luck I had with Puppy, was using Puppy Package Manager to install Wah!Cade. After some frustration, I was able to play a couple of my games, but not in the illusion of an arcade.
With Puppy Arcade, I could never get my mame roms to play.
Illusion of an arcade - I turn my machine on, after it boots, there is a screen filled with games to choose from. I use my joystick to choose the game, pressing 1 PLAYER to start game. This way, I don't have to grab a keyboard and mouse, load up the program and then start running the game.
as on another post, the best Operating System I have had success with is Lubuntu, running AdvanceMame, AdvanceMenu and AdvanceMess. For some reason, all 3 need to be installed, and the autostart is set to run ADVMENU as my frontend.