Gene talks about it in depth here on audioholics YouTube video.
He just says it's an all-pass filter. No mention of why it's needed over just adjusting the distance to get the same result at the crossover. At least I don't understand why the result at the crossover should be different. I asked for measurements, but he said REW is problematic to run in this space because the receiver is in a different room, which is unfortunate. And unfortunately I haven't really seen anyone reviewing Arc before/after results with REW, not to mention seeing one do so after the latest update and comparing the different ways to improve subwoofer integration.
Currently it seems Audyssey Arc and Dirac have similar capabilities in terms of low frequency correction to the set target curve (although for Arc I haven't really seen actual measurements to confirm, it just seems to be the case according to other people's experience), and where I found real (meaningful) differences in how they work is in the crossover handling, but couldn't find anything that helps me understand if those differences are of a real significance for the final result in real use cases, and what is actually the desired capability for best crossover handling (aside from completely free selection of filters, which is not available in mainstream).