@shylock since more or less every videogame supported by retropie is in 4:3, you're always going to get borders on the top and bottom (rather than the left and right that you would get with a 16:9 display. integer scaling won't make a difference.
with vertical MAME games it would be a nice fit, though: smaller borders on left and right than (un-rotated) 4:3 or 16:9 screens.
you'd also probably need to get a custom emulationstation theme done, unless someone has already done a square one, otherwise it's going to a look a little funky it think.
and then run update pcsx-rearmed from source in retropie-setup script
Then you will be able to run this emulator without performance issues but only with USB keyboard. I am now struggling with key bindings, I am not able to bind UP/DOWN/LEFT/RIGHT buttons of GBZ SAIO.. probably because they are not buttons but hat... I don't know now.
Another issue is with the mouse cursor being visible in some games, but this could be hopefully easily fixable.
And for the record, the main problem has been caused by one commit to libpicofe adds SDL_DOUBLEBUF flag.