Disclaimer: I don't have a Hunter with a stainless arch, and I am not a welder.
If your boat is going to distort in that area simply by removing the arch, I'd be too afraid to sail on it. I know Hunter is often the butt of a joke about bendy, etc, but I don't for a minute believe that this will happen by removing the arch (I don't believe it at all for other aspects either).
I agree that the fiberglass could be burned a bit by welding that foot in place, but a welder would be a better judge. A compromise would be just removing the nuts and jacking the end up off the fiberglass leaving the bolts (or temporary longer bolts) in place for indexing.
Otherwise, removing that arch looks like a dead simple job. Even with 5200, that would only slow down the removal by a few minutes. 5200 on a flat piece of metal like that is very easily dealt with.
I would think that the choice of removing the arch and welding it remotely vs. welding it on the boat would be determined by how well the welder can access the geometry for the weld. This area doesn't look easy with closed up angles and deck in the way. Also, it looks like it has pulled away from the foot plate at the crack, so would need to be put back in place.
With the overhead traveller, that particular weld really takes a beating. Talk to the welder about adding a gusset to the foot plate or similar there to strengthen it. I'm not sure that original weld had a lot of penetration, so also talk to the welder about removing the foot plate altogether, cleaning out the old weld, and making a better weld.
Then why not do the other side? If it looks the same type of weld quality, or the welder thinks a gusset is a good idea, then make both sides the same.
Personally, I'd remove the arch and give the welder the best possible conditions and options for fixing it. If you and the welder are convinced that this weld just needs to have another bead laid over it, and doing so is easy enough, then I'd jack it up off the fiberglass a few inches and weld it in place.
Mark