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The ones I know have day jobs but many are students and contribute out of a combination of passion and a desire to learn. Often the emulator work is put to pasture when they leverage it to get hired unfortunately.

Dolphin has been around since 2003. Don’t think it’s been the same devs, but there’s definitely more commitment here than just a college side project

Whatever their motivations they are such a gift to humanity. Preserving art for generations to come, it's incredible!

How many old iphone games are just completely lost now because it's a closed system?

One datapoint: I follow one of the devs on Twitter and he was - until very recently - a software engineer working on security infra at Google.