If you want an improvement over the Xbox 360's current D-pad, you can wait until November 9 and pick up one of the new controllers with the twisty directional pads ... or you could get one of these things. Evil Controllers is offering standard wireless or wired Xbox 360 controllers with the addition of the "Evil D-Pad," which replaces the traditional rocker switch with four buttons. Desperate times (including any time you're trying to play a game with the D-pad) call for desperate measures!
You can order a wired controller with an Evil D-Pad for $54.99, or a wireless version for $74.99. That is, of course, unless you choose to bundle it with other mods. If you're going to do this to your controller, why stop there?