Okay, I hadn't noticed that setting before, don't know how I missed that. Only problem is I'm dealing with a spinner on one particular machine, so I don't have mouse buttons (left/right click). Switching to this setting disables the joystick and buttons meaning I lose almost all functionality.
Is there a way I can create a remap file that assigns button0 and button1 on my arcade controller as left and right click. Maybe also enable two other buttons (or even the joystick) to act as mouse up/down (y-axis +/-)?