You have to start the game once, the xiii.ini file will be created then.
Just quit without creating a profile and edit the file.
No, sorry - it did not create the file...
[ Are you running on Vista or Win 7? If so, this might be one of those situations where Windows is putting the file in a weird location, like C:\Users\<username>\AppData\Roaming.
Nor is the file in any other location...
Do you have Windows configured to hide the extensions of known file types (it's the default setting)? If so, that might be why you can't see it; .ini is definitely a known file type. On my system, with the files sorted by name, XII.ini is right between XIII.frt and XIII.int. If you are missing that, then it sounds like there is something wrong with your installation and you may need to re-install the game.
And I always show hidden files, never understood the reason to have hidden files...
Oh well, looks like it needs a new install. Interesting enough the game works fine without it