Ok this is actually a question thread for me. i was reading on TEL that arkay was not a god untill mundus was created and lorkans heart cast into morrowind. Just a quick explanation will do me.

Well he is the aspect of life and death personified. Lorkahn/Shor introduced the concept of limits. The ultimate limit is mortality. Without mortality, Arkay would be nothing. At least that's my educated guess.

From what I've gathered, this is pretty much correct. Before Mundus, Arkay was, as the Redguard pantheon appropriately puts it, the God of Nobody Really Cares, because there was no cycle of life and death. It was after Mundus was created that Arkay found purpose. Other sources cite Arkay as being mortal himself before being a god.

Out of curiousity. Would Arkay and Meridia be friendly or hostile too one another in terms of worshipper interaction?

I guess. Necromancy is both an affront to their respected concepts. It could be a "The enemy of my enemy is my friend" kind of relationship.

Fantastic. i just found my next Paladin RP. Torn between two beings more powerful than himself kind of angle.

Nice. I just wanted to know as Arkay is my favorite god behind Akatosh

The other source is http://www.imperial-library.info/content/arkay-god which describes Arkay as a mortal who finds his purpose in his own death. Much like Thu'Whaca would have after taking part in the creation of the world. You might say that after Daggerfal the story has become allegorical.