These feel fantastic:
http://www.amazon.com/Redesigned-REPLACEMENT-Joystick-Controller-Thumbstick/dp/B009MRZAUC/ref=sr_1_1?ie=UTF8&qid=1359598107&sr=8-1&keywords=n64+joystick
However, you'll see lots of comments on how they are "too sensitive" and other untechnical, somewhat unhelpful information.
It's because they skip steps...
https://www.youtube.com/watch?v=o0VO46SWo2M&list=UUNVzH9f4y0-lGq490h7mgPA&index=1
micro, over at nfggames was at one point making custom PCBs that fix the problem entirely. I was lucky enough to get in early and order 4 from him (they're en route as I type this).
Alas, he's out and may not even make a second batch - http://nfggames.com/forum2/index.php?topic=5023.0
However, he offers his code for anyone who wants to flash their own chips:
http://www.mediafire.com/file/q4232gx1w2q2w0s/GC_PSX_stick_in_N64_controller_v1.2.zip
I certainly have not come across a better solution than this.