Thats not good to say the least, threaten them with the press, trouble with most bike mags and MCN is they rely on advertising revenue from all the manufacturers so may be hesitant to run any negative press about any of them, my mate just ordered an MV F4, got a feeling he will have issues with that too, small company's just dont make enough bikes to ensure the reliability (although Kwak 10 brakes obviously slipped through along with my rusty tank . . ) , Italians call it character .. . . . rest of us call it crap build quality ! Write to KTM, explain you dont want to go to the press but you will if its not sorted to your satisfaction ,give them a time limit, say 21 days, keep copies of everything you send and use registered post,explain that you are without use of your bike and its your only transport etc etc, go to trading standards too. Imagine had you not noticed this crack for a few months and had the arm fail ! Scary.