@naughtjosh How did you connect the controller to the GPIOs ? Did you install any of the additional drivers needed for such setup - https://retropie.org.uk/docs/GPIO-Modules - ? Simply connecting a few wires to the GPIO pins is not enough.

Ideas that don't require any downloads?

Set-up your PI on a location where you have internet, just in case you'll need a driver to be downloaded or use your phone as a WiFi access point.

For the RetroPie menu - check if you have a retropiemenu folder under the retropie-mount folder on the USB. If you don't, then re-install the retropiemenu package from the core packages section in the RetroPie setup script. Make sure you have your USB plugged-in.

For the 2nd problem - you'll have to be more specific: what does in game configurations can’t be saved ? The emulator configurations are not saved on the ROM folders.

I've just done this with an ipac2.
You can configure player 2 in the retro arch menu (vids on you tube)
When entering the player 2 button key binds ...Check the order compared to player 1. Strong chance it will not be what you think.
Once you have done that you can quickly map your button inputs and save.

@shoothere You could try this awesome script:

https://retropie.org.uk/forum/topic/1167/here-is-a-way-to-select-joystick-for-players-1-4-global-or-emu-specific

Does it look like one of these?

http://www.ebay.com/itm/Arcade-MAME-DIY-Kit-2x-LED-USB-Encoder-2-Joystick-20-Illuminated-Push-Button-/261564066052

If it does, you may have connected the connector from the usb board to the joystick the wrong way around. I have 5 of these and I managed to get it wrong on 2 of the joysticks. In both cases, the result appeared similar to what you've described. Turn the connector (the end attached to the joystick) around and see what happens. That fixed it for me anyway.