I had the same thought yesterday! It would be an amazing addition to the RetroPie project. Looks like there is recent activity with the linux version. Maybe ask the developer directly? http://www.elecbyte.com/
I’m a Linux senior and after trying and studying a lot, I found the awnser.
I’ts NOT possible to run MUGEN in RetroPie with the Raspberry Pi (Version 1).
1) The RPI doesn’t have enough hardware to run the game.
2) The dos emulators (dosbox) run at a speed of around 20MHz 80486 (which equals a 40MHz 80386 machine) according to dev page, witch is not good to run games
3) There IS a version of DOS mugen that can run in Linux (by dosbox), but the RPI does not accept the feature of charing memory.
So, even if it was possible to emulate de DOS Mugen under x86 dos (dosbox), the game would run at…. 0.5 FPS ? It would be tooooooooo slooooowwwwww.
Sorry guys, but this is the reality. The RPI isn’t good enough to run Mugen (and some sort of DOS games).
I had looked at this possibility a month or so ago and found a new project that combines MUGEN and OpenBOR (think mugen engine for games like Streets of Rage). The thread I’m linking below was the most helpful thread I found. Basically it can be run but at the moment it is very slow. They suggest another way of compiling that may let it run faster. I have not tried it yet.
This is probably your best bet currently for running MUGEN.