How to gets analyts and generate visual reports from sessions? I'm looking for a technique or approach to get data from user session logs and convert it to a some sort of visual style (bars/charts/whatever).

We'd like to specifically have the users session "arcs" (login-&gt;news-&gt;something-&gt;logout) displayed in a way that makes it easier to analyze the way people use the site.

This is meant for our service as a usability analyser with the idea that we could make out and see the UX/UI problems that users experience, just from the statistics.

Google Analytics and Piwik are cool and have some of the same functionality but we're looking to go a bit further...

Any ideas on how to get started? Also if I missed an obvious way of doing this, feel free to point out!
I don't know of any modules that build this functionality inside Drupal itself. However, there are several tools out there, for which there are Drupal modules, that allow you to visualize the arc that you speak of. Two of my favorites are:
MixPanel: Mixpanel can allow you to create funnels that will help you see how the user is progressing through your website. For example, how many logged in users clicked on a product, how many of those went on to the payment page, and how many of those actually ending up paying. Mixpanel also has a Drupal module for easy integration. Or you could easily integrate this using a custom Mixpanel module with minimal effort. This is how a funnel in MixPanel would look like:

(source: wordpress.com)
Google Analytics: It has a fantastic Visitors flow functionality that will allow you set flows, goals, and track against those too. Again, Google Analytics has a readymade Drupal module. Here's what a flow in GA would look like: