This should have been posted in the GCW-Zero section and not the Dingux section, but here's what I have to say.
Get a GCW-Zero.
I, like you, have played video games my whole life. I'm a retro gamer.
Onto your questions...
1. There is no button lag on the GCW-Zero. That I promise you.
2. There is a TG-16 emulator being worked on from what I've heard, using Mednafen.
3. The Game Boy/Game Boy Color looks perfect on the GCW-Zero. Also, along with the GCW-Zero's GB/GBC emulator, you can download the Game Boy's color palettes which you can set in the emulator's options.
4. NES is perfect as well. It looks incredible on the GCW-Zero.
5. PSX is being looked at, and we'll see what we can do. Emulation is possible though, as many games run full speed.
6. The GCW-Zero has many amazing games available already, and developers are hard at work, releasing new games often. There are also many great ports as well, such as: Cave Story, Quake, Quake 2, Doom, Doom 2, Shadow Warrior, Duke Nukem 3D, Wolfenstein 3D, etc.
7. The GCW-Zero I got had no issues with the buttons. I believe it was only the first batch with dpad issues.
Bottom line, I recommend the GCW-Zero highly. It has become my favorite game console and my prized possession. I have many emulators and games on it and play them every day. Emulation is perfect for every emulator. Though a few features are still missing (TV-Out), they're being worked on for a future update.
Most sites are out of stock, but a new batch will ship soon, from what I've heard.
If you need any help, just shoot me a message, or post in the GCW-Zero help section.