Related to this post (locked now for some reason) - https://forum.recalbox.com/topic/19820/ps1-dualshock-controlle?_=1608352735895
I have found the answer. It is a Sony driver issue. How do we get this update included?
Sometime around the 4.10 Linux kernel, the hid-sony.ko driver was updated and broke some USB Playstation adapters. Kernel v5.6.17 and up appear to fix it.
Relevant links:
The fix - https://lkml.org/lkml/2020/5/13/1323
Discussion and workarounds - https://www.linuxquestions.org/questions/linux-games-33/playstation2-controller-with-usb-adapter-need-help-getting-additional-buttons-to-work-4175643583/
v5.6.17 Linux kernel fix - https://elixir.bootlin.com/linux/v5.6.17/source/drivers/hid/hid-sony.c