Dreamcast multiplayer games!

[Mod_Man_Extreme]

Sonic Shuffle, although you may want to rip the disc to shreds from the difficulty/annoyance of some of the minigames.

[brokenpavement]

Zombie Revenge is a fun arcade game that is 2 player co-op. Also, Cannon Spike is incredible.

[lisalover1]

Power Stone is an amazing multiplayer game, along with the obvious Bomberman online, and Propeller Arena. Oh, and Unreal Tournament is a total blast.

[Original_Name]

I second Power Stone 2, Virtua Tennis, Chu Chu Rocket!, Propeller Arena, Ooga Booga, Bomberman Online, and Cannon Spike, but I'd have to add Outrigger, Samba De Amigo, Beats of Rage, as well as Dead or Alive 2's Tag Mode for 4-player titles. Oh yeah, you said you were looking for co-op, so Gauntlet Legends is a must!

You said you already have alot of racing games, and you're probably gearing more towards 4-player, but Sega Rally 2 is a FANTASTIC 2-player game. I loved the tight, responsive Sega Rally on Saturn for years, but when I gave Sega Rally 2 on Dreamcast I didn't like it at first because it felt so loose. Try it as a multiplayer title though, and it's a blast! It plays like the most solid kart racer ever made or something.

Also, Ikaruga, The House of the Dead 2 (or Typing of the Dead if your friends are cool enough), Soul Calibur, and Marvel vs. Capcom 2 are such great 2-player titles that I don't think people will mind sharing.

Gah, the Dreamcast just kicks so much ass!

[fast]

My friends and I have gotten the most out of the following in fourplayer:
Gauntlet Legends
Chu Chu Rocket
Powerstone 2
NBA 2k
NFL 2k1
Marvel vs Capcom
Toy Commander - though initially I suggest limiting everyone to land or air until they get the hang of it.
Star Wars Demolition
and Unreal Tournament.