Try adding
input_libretro_device_p1 = "5"
input_player1_analog_dpad_mode = "1"
input_libretro_device_p2 = "5"
input_player2_analog_dpad_mode = "1"
To the file retroarch.cfg in the folder /opt/retropie/configs/psx/.
Make sure you include the code on top (above #include…)
