It does. This was posted on Mac Rumors by the guy who created iMame4all, which is what iMAME is based on:
Hi all,
This app is based on my iMame4All Xcode project, which in turn is based on Seleuco's iMame4All for iOS devices port. To find out what works and doesn't work go to my website here:
http://www.lesbird.com/iMame4All/iMame4All_Xcode.html but to sum things up:
1. WiiMote's don't work. They require chip level access to the Bluetooth chipset which will only work on jailbroken devices.
2. You need the ROMs for iMame4All for the GP32X (MAME v37b5). If you can find them they should work.
3. When I created the iMame4All Xcode project I included all of the sound samples for the iMame4All ROM set.
I did not submit this to the App Store, that was done by Jim Van who used my iMame4All Xcode project as a base starting point then trimmed out anything that was not App Store compliant.
For controllers there are 2 options - iCade and iControlPad. Let me explain the difference between them. When you connect your iControlPad or iCade a window will pop up asking which mode you want to use. I highly recommend choosing iCade mode for both controllers (put the iControlPad in iCade emulation mode). The reason is that in iControlPad mode it expects the controller to be in special packet mode. This will allow you to use the dual nubs on the iControlPad to play games like Robotron, however the downside is that there is a lot of data being transmitted over the Bluetooth and iPad 1's and anything less will have a hard time keeping up.
Hope this clears some stuff up.
- Les