Google could easily subjectively interpret most arbitrage pages as a violation of their program policies, but it seems that they don't, or at least they don't care enough to widely enforce it. I have read on this forum and others about a few people who were doing arbitrage who got banned from AdSense, although some (maybe all) were probably banned for other reasons. Do a search of the forum to find these... I'm too lazy to dig up the links.
I'm not taking any chances on getting banned from AdSense (I need it for my white hat site) so I'm doing arbitrage with YPN.