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Thanks for porting this over to PS4.
Once installed onto the guide, the tolerance between the rack groove and the guide block is actually quite loose. I suggest tightening this tolerance.
In addition, both ends of the guide don't need to be closed, as the stick itself limits the motion of the rack enough. Leaving one end open would make assembly safer and, again, allow you to tighten the tolerance between the grove and guide. Stiffness can be maintained by just making the walls a little wider. See my make for what I mean by this.
The arc-shaped travel of the pin can be solved more simply by changing the pin hole on the joystick holder to a vertical slot.