That should be how it works, as long as you follow the directions about setting up your AEM tach output.

Would the tach output wire from my arc-2 box be another acceptable location for a tach signal?

It should be OK. BUT, the ECU output is preferable. There are sometimes issues when you hit the rev limit, where a tach signal would bounce all over the place. The ECU tach output should be consistent. But if the ECU is cutting the ignition at rev limit, it would cause the signals to the ARC-2 to bounce, which would cause that tach output to be eratic.

Planning on starting the car on Saturday. With my current setup is there anything special that I have to do for the ems settings? I know that many people use the invert cas option on dsmlink.