I haven't found much on this issue in search. The last time reading files was addressed looks like it was in 2007, so there might have been some advancement since then, though the documentation doesn't really say.

Basically, I want to write out to a file, and read from that file as well. Is this even possible right now? I've made a new input function, and would like to design some way in which the player can designate what button they want to use for it, and for the choice to be saved between sessions. File I/O seems like the best option.

No. You need to compile the i/o library separately from the lua source and include that as a module. Data removed I/O functions to prevent people from breaking other people's games/computers/etc. But that's sort of pointless as it just makes us work harder by packaging the proper dlls. He ought to just make it so we can only read/write to a data folder in the CC folder. That'd be nice.