What would you play two player that way? Just have two one-player cabs, with mirrored screens, for street fighter? Or two 2-player cabs, and hook 'em up to play TMNT?
This might be a good idea for mini-cabs, built to be one or two player but able to link up, and small enough to carry around at will.
Here's what I'm thinking: Molex connectors would allow you to plug a second control set into your ipac whenever you want, just attach your buttons and joysticks to molex plugs and counterpart molex plugs to your ipac. The monitor can be disconnected and reconnected at will, and you can get extension cords for them so your cab could even have a "monitor out" port on the back of it. Dual screen video cards are nice. I use one for grafix, so I set the display mode to 'Clone' (it's nVidia) and started up Mame. Seems to work!
I think the best way to accomplish the easy hot-plugging control panels would be to get 15-pin Molex connectors, which can handle a joystick, 6 buttons, coin, start, one spare, and two ground pins, and make the layout of the button and joystick connections standard for your molex plugs. (i.e. the top middle button will always be on the same molex pin on every layout you hook up.) Then, all you have to do is plug a player's layout (might be two layouts on a panel) into the player you want it to be.
It might be worth putting the Ipac into its own box, and having four female molex connectors hanging out. Then you're completely modular, you can even plug in a dance pad or arcade-enabled coffee machine.
Here's my dualie playing dualie-Golden-Axe on dualie screens. dualie.