I'm curious also to find if it is possible to begin input in this manner
$script.sh input
where the user enters 'script.sh' but the input goes directly next to the command instead of the new line. \c doesn't seem to work but I think it should be possible.
Has anyone done this before? Its probably a normal enough requirement?
which automatically throws the cursor below the command waiting for input, and if I enter the input directly following the command and press enter then it sits on the next line waiting for the command still...
That is how the read command works. The args passed to a shell script are labelled $1, $2, ..., $9, ${10}, ${11}... The double digit args are not available in the original bourne shell, but you can use them in the ksh and the bash shells.
About your code:
#!/bin/sh
variable=$1
echo $variable
Then run the script the same way that you are currently running it.