Xbox cloud gaming split screen second controller not recognized

Our second Xbox USB controller is not recognized whenever we attempt to play Arcade Co-op via Xbox cloud gaming on PC.  Both controllers are lit up, but as soon as we select our side and mission, we receive the following error message: Please connect another controller for the second player and press [three horizontal lines button] to continue.  However, pressing the three horizontal line button with either controller does nothing.  We have tried restarting, unplugging both, etc.

Would anyone know how to continue troubleshooting so that our second USB controller can be played by the second person?   

Thank you so much in advance!