I made some changes to how it detects gamepads in one of the more recent betas. Try this and let me know if it works any better: http://streetsofrogue.com/sordownloadsbeta.html
Yeah I forgot to respond but it still does the same exact thing. It defaults player 2 as having buttons assigned in gamepad setup and player 1 has no buttons setup so i assign the controller to player one it asks if i want to unbind from player 2 i select yes now all buttons are assigned on player 1 automatically. Now the gamepad works in main menu soon as the character select screen comes up the gamepad no longer works matter of fact no buttons work. If I bash a bunch of keyboard keys at the same time every once in a while it will jump to a different character on the select screen but that's it. Anyway thanks for trying game looks amazing I will try xpadder or something when I feel like installing it, was kinda hoping to get the gamepads working it looks like a great 2 player same screen game.