hey, you should be able to use both the analog and d-pad at the same time. set your dpad keys with the analog button. if you cannot control the dpad, i think you have interference from another usb device. i have a psx controller with analog. when the analog button isn't pushed, the left analog controls the movement and the dpad does nothing. when the analog button isn't active, the left analog and dpad controls the movement, and the right analog and L1L2R1R2XBAY can control the action buttons. if you have a usb conflict, the control is mixed up.
make sure the red switch is selected on the side if it has both n64 and psx ports.