Hi there!
I'm only replying here to give you the solution I found to get my THT THT 2 Player Encoder working on Raspberry PI3, and Retropie 4.3.
I can say the usbhid.quirks=0x16c0:0x05e1:0x040 command didn't work for me and after hour and hour of trying I opened the cmcline.txt via the retropie
cd /boot/
sudo nano cmdline.txt
Before that I did it only by pulling out the sd card putting in to my pc, changing the cmdline.txt with the windows editor with one space at the end of the line and....... Never worked...
After I took a look in the cmdline.txt via retropie I saw that the "usbhid.quirks=0x16c0:0x05e1:0x040" had two spaces between the last command and was also in the second row of the file. I wonderes an changed it. Bam! That was it! Now 2 Gamepads are detectet and eveything is fine for me. May someone will have the same issue with the cmdline.txt file without recognizing it.
Have a nice christmas!