As from time to time I still have the sudo password prompt hitting me back on a system where I can't change /etc/sudoers and this is one of the first Google results: sudo password will be requested if you changed the runcommand configuration to set the CPU governor to something that is not default. It'll request password during game launch and after the game ends (to restore previous value).

So, solutions are, like described above, add entries to /etc/sudoers or change runcommand config to not touch CPU governor.

@paulnmiller1 Yes, changing video driver to sdl2 in RetroPie Setup as suggested by @mitu worked immediately.

Sorry it took me a while to copy some roms over and check everything out but yeah they played normally.

@mitu I see. I'm able to install Vice using Ubuntu app center. I wonder if I could copy binaries and libs to the /opt/retropie/emulators/vice ...

@macsgv Thanks, but any chance you could do a quick writeup?
I hate "watching" tutorials on principle - plus it's in Spanish and does not seem to refer to lr-hatari anyway.