Personally I would prefer either Python, the JVM (for Clojure and Scala) or the .NET framework (for F#) as the scripting implementation of choice.
That being said, even with its 1-based array silliness, complete lack of bitwise operators, and somewhat verbose syntax, I would still happily take Lua over what we have now. We would have proper closures, data types beyond numerically-indexed lists, sensible scoping rules, and a non-infix syntax for invoking functions.