British design agency CxPartners has a great infographic showing the evolutionary relationships between video game controllers of the past and present. It's interesting to see the direct influences of the past and even less than successful designs get re-imagined into something more fitting in today's culture.
Controllers such as Nintendo's Power Glove, which was an essential failure due to it being incredibly imprecise, is now re-envisioned through Nintendo's Wii Mote which was developed about 15 years later.
CxPartner's Steve Cable does have some closing thoughts regarding our controllers:
"The d-pad was designed because a conventional joystick would not fit on a handheld clamshell device that needed to fold. The Wii mote was designed because Nintendo were in a loosing battle in an arms race of hardcore gaming machines. They needed to re-think gaming as a whole, which included how games are controlled. This shows that innovation in interface design can be a great success, but you should only use it if its absolutely necessary."