How do arcs generate radio-frequency
It's a spark-gap transmitter - here are some words from the internet 

"Spark gap transmitters are the oldest type of radio transmitter made by man. They were first used around 1888 and remained legal until the 1920s when their use became greatly restricted. World War II delayed their complete ban outside of emergency communications for a few years. Now the only way to use them legally is inside a faraday cage. They operate as jammers for the same reason they were banned, they take up a lot of the radio spectrum. A spark gap transmitter is fairly simple. Send a high voltage current through an air gap, when the resistance of the air breaks down a spark will cross the gap. When this happens electromagnetic radiation is emitted."

The difference between your welding apparatus and most spar-gap transmitters is that they had tuning coils and capacitors so that the spark energy could be constrained in the electromagnetic spectrum. Having said that they weren't particularly good at that hence they were banned.