I could not read files using network.download into system.ApplicationSupportDirectory. When i downloaded the app container, found out that the path for directory did not exist. (Supposed to be inside Library) After adding
lfs.mkdir(system.pathForFile("", system.ApplicationSupportDirectory))
Everything works out fine. I can now read/write files from/to the Application Support directory with no problem, download files and then use them. After re-downloading the container it now shows up. I guess this is a bug, or it could be added to the docs.
This only happens on iOS. tested on iOS 10.3.2, Corona 2017.3081. Does not happen on Android or the simulator for mac. Did not test on Windows.