Mine didn't work so I followed the advice in this forum and it worked, but I have an easier way than coping a cfg from an XP install of CFS.
All I did was to edit the cfg (under [controls]) and ereased the garbage found there and entered the name of my controller as found in the control panel "game controllers" applet. Save it then right click your short cut and on the compatablility tab use winxp serv. pack 2. Now start CFS. If you get any messages about your controller wanting to change assignments answer no.
goto settings again ignoring any messages about your controller by answering no, and in the settings menu goto the controller settings and instead of your controller name appearing there will be a plus sign. select it and your axises shold appear in the drop down window.
Make any changes you want click ok to the main menu then fly. BTW my joysrick is a Saitek Cyborg 3D Rumble and yes it rumbles!