1. Building a quad set up. As far as players 3 and 4... I see some cabinets with 6 or 7 buttons. Is there any point in having that many buttons for players 3 and 4? All the 4 player games I can think of use maybe up to 4 buttons.
The only reason for 6 buttons is if you plan on playing 4 player games on other emulators such as SNES. If you're doing MAME only, you don't need that many. 3 or 4 is plenty.
2. If I build a 4 player cabinet, can I use the 2 joysticks on either side in conjunction for games like smash tv or robotron? Like player 1 and 3 together and player 2 and 4 together.
Yes. Depending on your layout, it may not be an ideal setup (they may be angled, etc), but it's simple to set up. You can easily do it if you want.
3. Besides the buttons for playing, and p1-4 start.. what other buttons should I have? An exit game button? Pause? Is it common to have a coin button? What do you guys normally have?
It's mostly personal preference. You'll need some way to coin up, so you'll either need a working coin door or coin buttons. You can use shifted functions for pause, exit, etc, but if you think you'll use them enough, you can dedicate buttons to those functions. It's up to you really.
4. I need Capcom vs SNK 2 in my cabinet. Does anyone here have experience with running it on Chankast? Does it run well enough, or should I try putting a ps2 or xbox in there instead?
I won't be any help here, sorry... never used Chankast
5. Does anyone here have experience running a home console and pc in a cabinet simulatneously? Are there any tricks I should know as far as getting a joystick connected to both and switching back and forth as well as the video signal?
Most people wire up to switchboxes. You can hack VGA cables for video and use a VGA switchbox, and ethernet/serial/etc for controls. A few simple switches and you're using the other system.
6. I think I wanna use HAPP competition sticks. Any reason I shouldnt? Are the 360s that much better?
You'll never get a definite answer on this one, joysticks are a touchy subject. I like Comps, they are decent sticks. You can feel the corners on them if that matters to you. Supers are really nice too. P360s are great, and 49ways have gotten a ton of press in the past few months.... try whatever ones you can if possible.. there's no "right" answer to this.
7. Also I was thinking of these for use with powermame:
http://groovygamegear.com/webstore/index.php?main_page=product_info&cPath=83&products_id=238
Or can anyone recommend better lit buttons?
I haven't used them personally, but they've been very well received. Your other options are the Happ translucents that you can get from Ponyboy here on the forums, Happ, or FxButtons. I have some of those and really like them, but they are individual colors, not a one button solution for all colors. I really like them though.
8. Is there a trackball which is considered the best? I need one that I can light up, and doesn't have a visible plate on top. I don't want it to interrupt the artwork surrounding it. Any reccomendations?
Happ is my preference. The 3" Happ trackball are the best around IMHO. People like betsons as well, but the Happs are usually reviewed better. You can recess the mounting plate for the trackball for a flat install. They also carry translucent balls that can be lit up. Get them from Ponyboy or divemaster in the B/S/T forum to save cash.