Can't configure ps3 controller

I just got the system up and running, played a set of downs on 10-yd fight, because I accidentally hit the button twice. I was able to play with the keyboard, no problem.

I have my ps3 controller connected, and screen says that 2 controllers are connected. When I try to hold a button on the controller, I get no response from the system. I have my wireless keyboard, my USB stick, and my ps3 controller plugged in to the Pi3.

Also, can the games be stored on the micro SD card with the system, or only on removable flash drive?

EDIT: Unplug ps3. Works fine.