So during the Jam I kept getting this error "Houdini Installation was not detected.Failed to locate or load libHAPIL.dll. No cooking / instantiation will take place." and decided not to upload my submission. But I was able to fix it eventually. So I'll post what I did in case it helps somebody in the future.
C:\Program Files (x86)\Steam\steamapps\common\Houdini Indie\engine
Inside the folder of "engine" I noticed that only the Unreal folder hasn't been changed in a long time because of the date. The unity one was already up to date with a recent change. So that lead me to believe something was wrong with the unreal folder. So I deleted the "unreal" folder. Inside of steam I right clicked "Houdini Indie" in my Library and went to Properties. I then went to the "Local Files" tab and selected:
"Verify Integrity of Application Files..."
Steam detected the deleted files and made new up to date ones.
C:\Program Files (x86)\Steam\steamapps\common\Houdini Indie\engine\unreal\4.25
I copied the folder "HoudiniEngine" from the folder 4.25 because 4.25 was the version of Unreal Engine 4 I was using at the time.
C:\Program Files\Epic Games\UE_4.25\Engine\Plugins\Runtime
I placed "HoudiniEngine" inside of "Runtime. I made sure to delete the old folder of "HoudiniEngine" if one was already in there.
I went into Unreal Engine 4 and went to the project settings.
I made sure "Start Automatic Server" was checked. So I unchecked it anyways and checked it again to make sure it was working. I also put "Session Type" to "TCP socket" Not sure if any of this helped in any way.
I then scrolled down and went to "Houdini Location" section. I made sure to checkmark "Use custom Houdini location (requires restart)". I then set the "Custom Houdini location" path to
C:/Program Files (x86)/Steam/steamapps/common/Houdini Indie/bin
That's where Houdini was installed for me on steam.
I then went to Plugins in Unreal Engine 4 and found the "Installed section" I made sure to Uncheck mark "Houdini Engine".
I then went and restarted Unreal Engine 4. Then I went back to the "Installed section" and made sure Houdini Engine in Plugins was installed again.
Then everything worked for me and the error was gone.
Although whenever I close Houdini or stop it's process in Steam, it crashes my entire steam. So I have to reload it back up and log back in again. But this always happen to me ever since I got it. Also now when I close Unreal Engine 4 it crashes Steam as well because of Houdini.
I'm glad I could finally get it to work. I'm excited for whenever the next game jam is though!