You’re basically talking about housing a PCB, a SuperGun, a power supply and all the cords inside the housing for the arcade sticks. That’s a lot of crap to have inside a box. It’s possible, yeah. But with how much you’d be sticking inside the box for the sticks, it’s not going to be very space effecient at all.
However, if you are going to do something like this with say the Genesis version of the game (as opposed to the arcade game), you can definitely rip apart a Genesis board, install it into the arcade stick housing, and probably have everything hooked up to the TV with very little trouble.
It just all depends on if you want the true arcade experience or if you would settle for the home ports of the games.