Navigating the choices in a menu can be done using the D-pad.
The problem with using the stick to navigate menu choices is that it was too prone to accidentally selecting an option in the quick menu at the bottom of the screen. By splitting the movement and selection functionalities between different pads, that issue was averted.
If you want to restore the functionality for your game, you can comment out the keymap overrides in key_map_override.rpy.
Your key assignment makes complete sense! I commented out the changes and got your result described above. Unfortunately my gamepad (Dpad neither sticks) doesn't respond with your key mapping, I think it's my hardware, a $5 Controller for Windows so I tend to turn off the quickmenu. Thanks for your answer and also for the "index_of_gamepad_keys.txt" file. I need to look much deeper into this ;)
Kind regards
Tom