Hey there! No, they don't have to be A and B. Just having two buttons/keys that could function as A or B in a game. For example, you might want to use the J and K keys as A and B buttons, with WASD as your D Pad. Really, it's just about having the right number of inputs. Make sense?
Pretty much that, yeah! You can space them out a bit if you want. To me, it seems to make the most sense to have one hand be dedicated to the D Pad, and one hand be dedicated to A and B, but however you want to do it, go ahead!