I am still unable to set any custom button configurations.
When I go to the either the emu menu or the in-game menu and select the option to change all I see is < >. It then takes 6 button presses of "B" to get out of this < > thing. After that I see the ... highlighted. If I return to the game the buttons are now all screwed up.
For example:
Contra J (all default MAME settings)
I hit select + B to enter the menu
I exit out one level and choose "input (this game)"
Arrow down to P1 Button 1 and press A I see the < > as though it is waiting for input.
....no matter what I press nothing happens
....hitting "B" 6 times gets me out of this
Please excuse the blurry images, my camera does not have a very good macro mode.

Perhaps I am missing completely how to set custom button mappings. If anyone else has it working please type a step by step guide as to what you did.
Alek, what we need is a better way to map buttons. It should ask you if you want to set the button to "X-Y-A-B-Start-Select-Left-Right-Up/down/left/right-or a combination of two. The way it is now, if it is working, it is VERY confusing!
Thanks!