I also have this problem.
I can press 'Select' on the joypad to display the keyboard overlay, but cannot get the USB keyboard attached to the computer recognised as a controller.
Can anybody help?
Edit: actually, I think I've got it...
For anybody else in the same predicament:
1. Press 'Hotkey + A' together (both assigned to the joypad)
2. You then are presented with the core menu
3. Go to 'Controllers' option
4. Set controller 3 as the 'Sinclair Keyboard'