For the benefit of anyone else stumbling upon this via Google (I understand the last post is a year old), and trying to get Retroarch to work with Parasite Eve 2 with PSX Beetle HW.

PE2 really hates having certain settings changed from defaults. The 2 main ones are;

-CPU Dynarec (disabled)
-CD Loading Speed (2x)

Here's a quick screenshot of settings that should guarantee to work (with Retroarch on Windows anyway).

https://i.imgur.com/jUyS0to.png

I have the same issue. I hope the upcoming Duckstation psx emulator will not have this problem.

I follow a suggestion from the above URL (https://github.com/libretro/pcsx_rearmed/issues/41#issuecomment-235270798) that dankcushions post, and the game doesn't freeze now !

I had to set psx cpu to 72
pcsx_rearmed_psxclock = "72"