I am making a two player arcade game

Is it possible to stack 2 picade hats via a 40 pin splitter or attach one normally to the PI GPIO and power the other with USB from the Pi?

You could use something like a black hat hack3r: https://shop.pimoroni.com/products/mini-black-hat-hack3r?variant=19448025991 or a pHAT stack: https://shop.pimoroni.com/products/phat-stack?variant=658973392906 to attach multiple HATs or pHATs to your Pi, but you’ll need to make sure there are no pin conflicts. You can find pinouts for most hats at https://pinout.xyz/boards and there’s also https://pinout.xyz/phatstack to test directly, though some are missing from the lists on there.

There are some HATs that allow for stacking directly on top of one another, but they’re not in a majority. If you let us know which HATs you’re wanting to stack, or what it is you’re wanting to do, I’ll try and help further?

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You can’t stack two Picade Hats, they will both be trying to use the same pins for the same functions.
This might work though for the second set of controls.

Swap it in place of the Picade Hat in this, then plug it in via a USB cable to your other Picade cabinate.

You will end up with a Picade Hat you won’t use, but the console gets you the second joystick and all the buttons in a premade case. You just have to figure out how to mount the Player X board in place of the Picade Hat. Have a look see anyway.

Just jumping in here to say I did exactly what was described here and it does work perfectly. No difficulties mounting the Player X.

I was hoping somebody would say that. I’ve suggested this approach at least one other time, just couldn’t find the thread to see if it 100% worked.
I don’t own a Picade, its on my I want one list, just haven’t pulled the trigger on one.

If I was going to do this I think it would be two Picade Consoles. And a big monitor or TV front and center. You both get the same view of the monitor that way.