wheater you use opto or switch to pull down inputs it hardly matter your problem lies in using port0 as input port as pointed out earlier by kai that low to high rise time will increase you just do one thing connect dataout pin of 74hc165 to some other port and than read it and see if it works fine or just cut down the track conneting 74hc165 to port0.0 or take out pin port0.0 of mcu,as you said earlier port0.0 do not goes low when you conect any one input to ground now observe output of 74hc165.

kuldeep singh