There is an option there to change it. There is a plan to make any control configuration you want.
As for the problem it works for me... Try reinstalling
I had tried reinstalling the emulator as what you had proposed. However, I'm afraid it is still functioning the same a previously. I was still not able to map my psp directional buttons as my n64 direction buttons.
Had you tried changing you control configuration while you have your psp connected to your computer or is while you are running the emulator on your psp?