Go ahead and write your configuration as a fully Turing complete sub-application in whatever language you like. It will do everything you could possibly want, and in a few years it'll grow so complex and hairy that it will need its own fully Turing complete sub-application to configure it, lather, rinse, repeat. If you're really clever, every configuration layer will be written in a separate language with its own dependency tree, test framework, and toolchain.
Personally, I prefer not having to recompile just to change some variables and settings. I'm fine with INI or JSON (although I prefer Lua tables) when they're appropriate. The problem is not that configuration languages are a bad idea, the problem is interminable Turing creep and developers wanting every aspect of their applications to be as flexible and powerful as possible.
The premise of having a separate config language is fine - somewhere, somehow, inevitably, you're going to need a read-only data store for globals and references to system settings. You can hardcode all of those variables in your application or put them elsewhere.
I'm genuinely intrigued to see a non-trivial example of this, a configuration in use by an organisation with complex needs, describing its applications and its cloud infrastructure, while avoiding the pitfalls you describe that bedevil the use of Turing complete languages.