Also, the Lua version used in Grim was 2.5 (!) and a major issue was the lack of cooperative multithreading (see http://www.grimfandango.net/?page=articles&pagenumber=2).
I don't know what version was used in Escape from Monkey Isand (3.1 ?), but the current version of Lua also "runs in circles" around the Lua that was used in those games.
EDIT: more by Bret on Lua in Grim: http://www.slideshare.net/hughreynolds/lua-patient-zero-bret...