Basically, there is a cheat that makes the camera become a normal third person aka stuck to the back of your character. Why this wasn't an option in the settings is beyond me but here it goes:

Get in any level, start the gameplay part and press the minus key on your numpad (you might have to turn on the numlock for it to work) type "bod" and press the minus key on your numpad again then type "bucketofchicken" and then press the minus key again and voila - the game is now in third person perspective and is actually now playable with strafing and stuff. The cheat stays on throughout the levels until you turn off the whole game, then you would you have to type it back in again.

The default gamepad support is only for dinput controllers(so you can't use your 360 controller) and even that is buggy as it will only recognize the right stick as one axis so it's impossible to map it like a twin stick shooter at at least make the controls a bit enjoyable.

Technically you can do this with xpadder but if you want to do it all on Steam keep on reading.
So I figured using a steam overlay and Big Picture emulation of the keyboard should do the trick. The only problem is - this game uses DX7 so Steam Overlay doesn't work. So what you do is download the trusty old dgvoodoo2 wrapper from here[dege.freeweb.hu] extract it into the game's directory and from the folder "MS/x86" copy all the .dll files next to the game's .exe file. Then open dgvoodoo once and setup any stuff that you want (for example I tried to pump up the brightness) but overall the wrapper should now wrap itself around the game(you will see a small "dgvoodoo" watermark when the game starts and Steam Overlay should also appear.

Next you can create your own Gamepad configuration or download mine from here steam://controllerconfig/804000/1853929852 and that's it.