Ali Baba and the 40 Thieves and Atari Basketball are two additional games that made use of the 400/800's extra joystick ports. Ali Baba was turn-based, IIRC, so not as exciting of a use case, but playing basketball with three other kids simultaneously was a riot. Very special for the time.

Atari's port of Asteroids also supported four joysticks. You could play melee, co-op, or team mode, with four players on the screen at once. It was a blast.

https://www.atarimania.com/8bit/files/Asteroids_manual.pdf