Same issue here. RetroFE crashes if any of my 4 Xbox360 controllers are turned on after Windows has started up, but before RetroFE has initialized.
Edit: Another issue is that RetroFE doesn't favor one particular gamepad. My arcade control panel isn't necessary the first (joy0), but may sometimes be joy1, joy2 or even joy3 depending on what else is connected... is there a way to tell RetroFE to use a specific device or do I just have to list all of them in the controls config?