Yeah but ps3 controller does not seems to be recongnized. I will retry to set the buttons using dfo instead of xpadder. As long as the controller program doesn't mess with the game files then you should be ok. I use pinnacle profiler and it's so much better then any ingame support for most games DFO Gold.
The game doesn't recognize triggers or allows you to set your d-pad as hotkeys for skills/potions, so while not 100% necessary: No, Xpadder is NOT wasted hard drive space. Also, if you consider the whopping 4MB it takes up a space issue, i've got bad news for you...
I've always used logitech profiler with my gamepad for DFO (as well as other games)
So xpadder is kinda similar so i don't see why it would get you banned as its a tool that isnt used for cheating but for using peripherals.
I used to use it but i just adapted to the keyboard controls. If i didnt like somethin, i just changed it. Either the skill or the hotkey to another key/button. Overall, i think i got the R1 and L1 buttons to work, it was still fun and it didnt improve my game neither. The hassle i had was still using the keyboard for specfic things while using the controller cheap DFO Gold . Or plugging the controller in or out, which either turned on my PS3 and had to turn it off to play dfo or possibly had to restart dfo for my controller to work. It was worth it tho. At least to me.