I had the same issue and this is the solution what found a guy on Reddit.
I tried today, and I blocked when i tried to write with the SSH.
Would be wonderful if you can record your screen during the process.
This is the solution :
You need to install the GPIO driver that Pimoroni provides. Download this file https://github.com/pimoroni/picade-hat/archive/master.zip and extract it somewhere. Copy
etc/udev/rules.d/10-picade.rules to Lakka (doesn’t matter where,
/storage is fine) and SSH to it.
From there run the following:
mv 10-picade.rules /etc/udev/rules.d/10-picade.rules
dtc -I dts -O dtb -o picade.dtbo picade.dts
Then you need to copy the resulting file to the appropriate boot section.
mount -o remount,rw /flash
cp picade.dtbo /flash/overlays/
config.txt so the end looks like this:
And comment out the last line of distroconfig.txt:
Then remount the boot folder as read-only
mount -o remount,ro /flash
Then reboot. Your joystick and buttons should now be recognized. Now go to RetroArch and in Settings / Audio go to Device and choose sysdefault:CARD=sndrpihifiberry.
Now here’s where it becomes a bit touchy: you need to add
/etc and the only way to do this is to edit the SquashFS filesystem. At this point if you really don’t know what you are doing you can break your whole Lakka install. You need to unsquashfs SYSTEM, add
asound.conf from https://github.com/pimoroni/picade-hat/blob/master/etc/asound.conf in its
/etc and then recreate the squashfs. Finally replace the resulting SYSTEM file. I don’t even know if you can do this from Windows as I use Linux on my desktop computer. Here’s a quick tutorial on how to do it on Linux
EDIT: updated post as I got the sound to work.
EDIT2: added link to unsquashfs tutorial.