Try translating some Arc programs into Common Lisp or Scheme and you'll see what I mean.
And incidentally, I don't have to give hardened users of existing languages reason enough to switch. There are new people learning to program all the time, and to them, all languages are on a level playing field. If they look at Arc and CL and see that programs are 50% longer in CL, why would they choose CL?
a) Programs in "high level" languages can fail to be shorter than their lower-level equivalents. The simple solution: be merciless in keeping the important things short!
b) The overlooked problem in language design is high-level language brevity.
c) The "language design" problem that needs to be solved is... not sure about this one. I'm guessing it's the fact that the rate of change in the field is putting more programmers into the role of language designers at an increasing rate and anything that helps them avoid bad decisions based on ignorance is significant.
d) deliver informally as possible: when designing a new language, write enough to make the goals clear, address issues in a discussion group and put the code somewhere without sweating organizational details like setting up code repositories, bug tracking systems, regression frameworks, etc.
e) crude version 1: implement the minimal stuff using an existing system and don't worry about the fact that to the unaware it may seem just like a trivial program in that system.
f) iterate rapidly: don't get bogged down by things like release processes and backward compatibility. Just focus on getting feedback, experimenting, measuring and looking for improvements.
Taking the analogy to a house, Arc is like a half finished construction project. The frame is up, they're still putting insulation in, and there's one finished room with a cot, a table, and a hot plate which Paul Graham is using to cook the news.yc software. Sure, you might attract scads of interior decorators by opening your house up to random strangers, but very few programmers will be willing to come over to live in Arc. They'll stay in their own houses which are already well stocked with comfortable furniture, decorations, etc., even if it is all a little cluttered and you have to go through the kitchen in order to reach the library from the bedroom.
Some of the people speaking out against Arc are genuine trolls, but some are just saying in a non-tactful way that they'd prefer to stay in a house with drywall, thank you very much.