Ever since Raiden II was put into MAME, the difficulty settings seem to be hardlocked on "hard", regardless of the dip switch settings. I compared this to the old official japanese port (which used the exact same base code as the arcade machine; gameplay is identical; the original developers gave the code to the porters to release a win95 japanese binary back in the day; one of the first ports with truly arcade perfect gameplay that was not exactly "emulated", rather, rewritten), and there was a very clear difference in bullet speed between "Captain" (which is the Easy difficulty) compared to Colonel (which MAME seems to be locked at). Hardest is called General (which is even harder). Setting the dips to hardest on MAME, cause absolutely no change in difficulty.
Has this been acknowledged as as bug ? It's been more than a year since this game was promoted to working status, but I can't see any mention of this bug.