I'm getting tired of the constant questions regarding this thing, so I'm compiling all that I know into one thread. If someone sees a question concerning this adapter, please link to this thread.
As many have undoubtedly noticed, this adapter seems a bit dodgy, particularly when using N64 pads. PSX and PS2 pads seem to work flawlessly, but numerous people have problems with their N64 controllers. I recall reading somewhere that N64 support was added as an afterthought. Whether that is true or not, I can attest that the adapter does indeed work great with N64 pads with some caveats. I'll list what I know:
Users of Win2000 and WinXP need not worry about installing the included drivers. Support is built into the OS, and installing the drivers from the installation disk is not likely to solve an issues you may face. Users of Win98 and possibly WinME will need drivers. Simply follow the instructions included on the disk.
2. Analog stick doesn't work
After installing the adapter you absolutely must calibrate the analog stick. If you notice that your game character barely manages a walk despite full motion of the stick, you need to calibrate it. This doesn't seem to be an issue with PSX pads, just N64. Go to your Control Panel and open Gaming Options. Highlight the adapter in the list. It should be "4-axis 16-button joystick" for Win2000/XP users, and "Monster Gaming Device" (or similar) in 98/ME. Click the Properties button, then the Settings tab, and finally Calibrate. Follow the directions and everything should be fine thereafter. Keep in mind that you may need to repeat this if the adapter is disconnected.
3. When I click Properties in Gaming Options, all the buttons go crazy, like they're all being pressed
This one is a bit mysterious. First, I don't recommend using anything other that genuine, first-party Nintendo controllers with the adapter. Third-party controllers seem to cause more than their fair share of problems, and in fact they may not be officially supported anyway. I've also seen some first-party controllers exhibit the same problem. I can only surmise that the adapter is tempermental with older N64 pads, even ones that otherwise work fine with the console or other adapters. I bought a brand new N64 controller with my adapter and have had no problems. Bottom line? If you experience this issue, buy a new controller. N64 pads can still be purchased new at Nintendo's site. You could also buy an Adaptoid, which seems to play nice with worn-in controllers.
4. Rumble and/or mempaks don't work
With the lower cost comes the absence of bonus features, namely rumble and mempak support. They simply won't work. If you really need the features, purchase an Adaptoid.
I bought a number of these adapters in bulk; kept a few and sold the rest. I personally have experienced no problems with those that I own using a variety of emulator/plugin combinations. I have seen number three above with one of the adapters I sold, but after swapping the controller for another, the problem ceased. Most issues are controller and/or configuration related.