The package arts-1.1.94.tar.bz2 can't be downloaded from any mirror.
All kde-3.2.0 packages in portage point to some 3.1.94 version. But 3.1.94 doesn't exist; if you look on the KDE servers (even the ones updated every 2 hours) there are only 3.1.92 and 3.1.93 available.
That's why it's hard-masked...
They'll be on the mirrors soon...patience, my friend.