Eambo, please see the games specific forums for FF VII and FFIX. Someone else wrote up good settings for VII, and I wrote a long description for IX. VIII has issues in openGL with battle scenes. Sadly, I think your issue with music in FF VIII may be unique - I didn't have any issues, I don't know of anyone else that did. May be an issue with the ROM you have. I can't help with Tony Hawks, I don't know it well.
The software GPU is pretty straightfoward, it's just openGL that has issues. With SoftGPU the most significant options are the 'screen filtering' and 'force mono core'. Screen filtering is in video option, it makes things looks softer / less blocky, but crushes CPU performance (game runs bad). 'force mono core' is in system, you can check or uncheck it. It is only significant if you have a dual (or more) core CPU. If you uncheck it and you have multi-core cpu, games run much faster - specifically you can use screen filtering. Howerver, for me, games run choppy, if fast, and I don't like it. Others have reported instability, but that may be an ICS issue. I think it's fine for most people. If you don't mind the choppiness the games run fast (or - you may not have choppiness and it's just me). There's an 'enhanced 3d' option - use it or not, I've not seen it do much.
OpenGL makes a HUGE difference - if there are 3D objects. In the FF games the characters are 3D. Plenty of screen shots in the game specific forums (at least for FF IX).
Please see my OpenGL thread!! See my signature for a link.