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Thanks @terminator2k2 I see I've missed your previous reply where you've mentioned that as well. This is what I've been looking for, we will give it a shot, thanks again!

if it works ok in crazy taxi , then you just need to re-pin the same connections from the wheel to player 2 up + down on the S-JIHP which should be pins 24 + 26 of the i/o board.

It isn't, sorry for the mixup, @kioku25 meant AD0 and AD2 as per steering wheel pinout, not on your S-JIHP Mitsu. So they are connected to the AUX1 and AUX2 pins, 22 and 9.

Some more details can be found in this thread: PC/console controls that can be modded to work with arcade games via S-JIHP

Ohhh I didn't see that one! Thanks Mits.

If you confirm the pinout of the shifter I can tell you how to wire your S-JIHP. It should be just digital controls. I don't see why a shifter would be analog.

on sega i/o type 1 and 3 the up down shifter is wired to pins:

24 - shift up
26 - shift down

this is for naomi initial d 1,2,3 + chihiro outrun 2 and or2 sp + lindbergh initial d series + ringedge initial d series

pins 24 and 26 according to andy geezers website is player 2 up and player 2 down.

ive never used or even seen in the flesh a s-jihp so cant say for sure.....but if you have a multi meter , check to see where you get continuity between pin 24 and 26 of the i/o board to the s-jihp output connector......

Are you sure the signal is getting there. IIRC on the S-JIHP you can cut some traces and rearrange the inputs. Please check that.

Poking @Mitsurugi-w here.

Does anybody have any idea what else we can try here?

I've primarily been playing Initial D 6 with a Sega 837-14572, aka Type 3, I/O Board. But I ran into the same problem with ID 3 and a Type 1 I/O as well.
According to the pin-out provided by aoiddr it should be AD0 for stick up and AD2 for stick down, but as Sp33dFr34k said, I've already tried jumpering all of the pins on my S-JIHP in-game as well as in Test Mode, but the dang thing refused to budge.

Which Intital D vesion is it? If you are using a JVS with too little inputs, it may not show up. The best best is going into test menu and test from there.