There is already Lua support so this is just adding another language - thus if this is a bad idea, it is a continuation of an existing bad idea, rather that starting a new bad idea. If that makes a difference....
So yes while this is just a continuation of a bad idea, it's a rather substantial continuation. I fear that a lot more people will make use of this than make use of nginx's Lua support.
It became a lot more true during 2013, but CloudFlare had already been operating for a few years then. A lot of fairly simple code was retired to the profit of Lua code, which is way easier to maintain.
There are still important modules written in C and compiled with Nginx. There are also proprietary extensions of the ngx_lua api to manipulate internal some internal aspects of Nginx within the scripts.
source: I wrote a good chunk of both iterations.