So!! I finally got my gamepad to work well as a midi controller! There are a load of options for doing this, (and yeah I do remember Fruity Loops could do it internally to some degree since about v3) and you would think it would be very simple, but in my case I had to go through a bunch of apps and trial and error before i got it to work. Here is what i used that finally worked using Rejoice and Midi Yoke. You can even connect multiple joysticks by running multiple instances of Rejoice. The program itself has a small footprint and I'm sure you can run a few alongside your DAW and not feel any resource drain.
- Midi Yoke:
This is a "virtual" midi driver that will take the info from Rejoice and translate it into midi messages.
Now, the thing is, there is no "windows 7" version, so if you try to install it on 7, you will get an error and it won't install. What you need to do is run the installer in compatibility mode for "older version of windows", then it works. After the install the program runs in windows 7 with no problems.
Get Midi Yoke here - http://www.midiox.com/
This is basically a mapper that will let you config joystick actions into midi control numbers.
Grab it here - http://raritiesvault.net/bcd3000/viewtopic.php?f=4&t=19&start=0
The rejoice manual will take it from there, basically all you need to do after installing both aps is in Rejoice choosing Midi Yoke as your Midi Out, and in your DAW enabling Midi Yoke as an available input. Then, in Rejoice itself it is pretty simple to configure X/Y axis and buttons as midi control numbers (if you have a hard time the Rejoice manual shows you step by step). Now your joystick outputs midi like any other controller, and all you need to do is map it like you would map any other device in your DAW.
Here is an amazing link I found containing a boatload of other aps that create midi from non-midi devices and manipulate things: