More info-

I've confirmed holding the buttons down works in general. I played GIJoe and got the auto-fire and just held the button to get it to continually fire. So it works in theory and works on my cabinet.

Could it be specific in some way to MK2 - nvram, cfg or DIP switch settings?

I'm also not insane, right? Holding block in MK2 should keep the character's block held?

@Demarco72 Which image did you use to install the system ? Can you be more specific about the controller/gamepad you use - maybe a product page/site ?

@caver01 Thanks very much. This is exactly what I was looking for. The DK scenario is one I hadn't contemplated (map all buttons) and a good idea.

weird stuff: i tried running once again FF7 and it works now, without changing anything...
i'll try with the other PBPs i deleted now, really dunno why it didnt work before

@azamoth
As @caver01 told you there are several ways... and your display just needs a few Pins as told....

If nothing else helps use MCP23008 or MCP23017 gpio expanders and connect to I2C-bus. But please don't ask me how to do this. Never used that :)