My market research has shown that when you get below those specs you start getting into dumbphone/J2ME platforms, where you have other constraining factors.
It's perfectly legitimate to not care. Writing a from scratch bytecode vm is a fairly extreme last resort solution.
But on the other hand, the bytecode VM, appropriately scoped, could end up being easier than embedding lua. That is, if what you're doing is only barely more than loading and using data- not even quite crossing the boundary into turing completeness.
I can't help but remember fondly on the idea of the bytecodeVM that "Out of this World" used to draw vector graphics, and think "That. is. neat".
or the power and flexibility the SCUMM vm afforded story writers.
It's fetishistic and unrealistic I suppose, to think it would be cool to do some amazing game on some extremely primitive slow low power cheap machine that anyone could buy for like $10. The whole fantasy usually ends when you realise that the cost of displays is well beyond the cost any actual computer hardware you may consider.
I sorta doubt there are many games targeting these devices (and, more particularly, the people who still use these devices in 2014) in the first place, but even fewer which are pushing their headroom so hard that, if they decide they need what amounts to a scripting language, they can't fit one in off-the-rack.