Hi Sam, yes you can try navigating OSMC / Kodi. Reproducing the issue is seemingly random, although I find even more often than not, on OSMC boot with a USB cable plugged in, the controller starts off disconnected and struggles to connect when the logo LED is pressed.
If you do manage to connect, you can eventually see the issues after a period of time on the RetroPie addon from hissingshark, i usually just use the default PSX emulator.
I will let you test first, but I can try another fresh wipe since I might have installed bluetoothctrl after, but it isn’t on and bluetooth in MyOSMC is disabled, so I assume that shouldn’t interfere