read this the configuration overrides section fromhttp://blog.andressm.org/new-retroarch-features-2/
rgui_config_directory is important. if you look at /opt/retropie/mame-libretro/retroarch.cfg, check that rgui_config_directory is set to your /home/pi/RetroPie/roms/arcade/ folder, and that this where your cfg file is. i imagine it must be as don’t 2003 and 2010 use the same retroarch.cfg file??
as per the other thread you should do these tests with another config setting that you KNOW works from config files in 2010, and is obvious when it’s applied. eg, video_smoothing on/off or something like that. that way you know if your game.zip.cfg is being used and overriding your regular cfg.