Did you get two TL16C550CN? I've been digging around trying to figure out why you are having problems and one person got different chips from jameco.
edit: nevermind, their subbed chips worked.
ps I feel like a crazy person, for some reason I thought I had to downgrade the ROMs when we had two linked. I cant seem to find any info on the internet about this and may just be mis-remembering.
pps did you factory reset both games? Are they both on free-play or have credits? Also it takes like 15 seconds for them to start talking. You can tell because the attract mode animations on the dmds start to match up.