Hopping on the changing the controller bandwagon. I highly doubt Retrobit will release now or in the future an updated controller, I'm sure they'll stick to the official Dreamcast mold with just slight modifications to make up for the missing cord.
That being said, I do think it's possible to make a controller with an actual working second analog stick. But this would need the work of a mastermind like Chris (DreamConn) basically making 1-controller that acts like two peripherals (So that would mean, two-dongles controller port 1 and controller port 2). This way the second analog-stick can be mapped as a mouse connected to port-2 as where the rest of the controller is either a remapped keyboard or stock controller.
Has anyone ever tried to see if the games with mouse support accept a stock controller in port 1 instead of a keyboard and a mouse in port 2? If this doesn't work, it means the controller needs to act as a keyboard to get this working.