First of all, we make use of the optional sendButtons() function, which is present but commented out in file mtGen.c.  Here is what we did with this function:

void sendButtons(void)
{
  unsigned char myButton;

  // On the PICDEM.net 2, BUTTON0_IO is the right-most button
  myButton = !BUTTON0_IO;
  if (myButton != BtnD) {
    BtnD = myButton;
    //BtnDTxFlag = 1;  // Disabled: we aren't actually sending anything to the PC
    if (BtnD)
      HandleBtnD();  // Only call this when button goes down, not when released
  }

  // On the PICDEM.net 2, BUTTON1_IO button is 3rd from left
  myButton = !BUTTON1_IO;
  if (myButton != BtnC) {
    BtnC = myButton;
    //BtnCTxFlag = 1;  // Disabled: we aren't actually sending anything to the PC
    if (BtnC)
      HandleBtnC();  // Only call this when button goes down, not when released
  }

  // On the PICDEM.net 2, BUTTON2_IO button is 2nd from left
  // <Similar code here...>

  // On the PICDEM.net 2, BUTTON3_IO is the left-most button
  // <Similar code here...>

}  // sendButtons()

 That is, we don't actually send any values of variables BtnA ... BtnD  (which we renamed from Btn0 ... Btn3 to avoid the confusion with Microchip's numbering of button #defines like BUTTON0_IO).  Instead, we just call a special handler for each button, whenever the button is pressed down.