On a brand new installation, none of the outgoing s2s functions seem to work due to DNS resolution errors, tested with several different XMPP servers. Here's a gist of some of the errors:
debug Sending DNS query to 22.214.171.124
warn DNS socket for 126.96.36.199 disconnected: connection timeout
error Exhausted all 1 configured DNS servers, next lookup will try 188.8.131.52 again
debug DNS lookup failed to get a response for jabber.example.com
The server is running a plain vanilla 0.9.8 installation on Arch. The server has IPv4/IPv6 running dual stack, but AFAICT issue 352 is irrelevant in this case since I'm not running an IPv6-only setup. In any case I tried the 127.0.0.1 dnsmasq workaround but didn't help.
Also this doesn't seem to be a duplicate of issue 487, but I'll be happy to know if this is the case and when I can expect a release to test.
What version of LuaSocket are you using?
Are you using luaevent?