I think for the first meeting, we'd probably be better off meeting somewhere public. Not that someone will murder anyone, but I think it would make everyone a bit more comfortable... go somewhere public, if you're not down with the group, you're free to leave. I know that's how I would feel anyway. If we hit it off, I think a meeting at someone's house would be cool.
Just my .02 I think this is how some others did this as well... they met somewhere and set up other meetings at people's houses etc. Plus, at least in an arcade setting, there will be more choices. While a MAME machine can give you a ton of choices, I don't know how many people have 10+ machines and the room to house a bunch of people for a gathering.