Whether to publish a paper as both a university working paper and on ArXiV?
ArXiv and KIT scientific working papers are meant to make scientific research (in selected areas) more accessible. They are not traditional scientific publication venues, but rather a mirror of publications that might be otherwise less accessible (ArXix) or fast outlets for ongoing research (KIT).

It is less common to directly cite ArXiv or KIT working papers, when there are equivalent journal or conference versions of the article, which you might consider when you are deciding how to make your work available to the public.

It is perfectly fine, though, to publish in the traditional journals and conferences, and on ArXiv or KIT, provided that there is no conflict of copyright (typically, there is not when you put an author created preprint version on ArXiv or KIT).

Nonetheless, you should not feel obliged to follow the traditional scientific paths (i.e., publish on ArXiv or KIT only). Just keep in mind that it might impact the citations you get from other researchers.