…ok, well that hasn’t quite to plan, just finished wiping the drive and putting beta3 retro pie onto it, and same issue.
used gparted on my ubuntu laptop to wipe partitions on the USBHDD and create a new flat ntfs partition (not sure this is necc as I think when you apply an image to a device it goes over all the partition info, but safer>sorry)
downloaded a fresh version of the beta3 image to ubuntu
used dd through ubuntu to apply the beta 3 image to the USBHDD
booted the pi2 using the USBHDD
first screen when retropie finishes loading is:
no gamepads connected
hold a button..
press f4 to quit
pressing f4 has no effect, using a ssh terminal I then find and kill the retropie process which quits me back to commandline, where the keyboard works as expected.