[Coffee Place]
"...I don't have to tell you that I think that's a bad idea, right? I mean...y'know..." He does know about things that went down a looong time ago. Namely, keeping an eye on Magtok while he was trapped under the workshop once, on Winslow's behalf, because some stuff went down a while back. Arthur never got the whole story, but it's clear he thinks that Willow working for her dad's 'arch-enemy' is a bad idea.
He quickly follows that up with a more believable (and slightly-less terrible) excuse. "He did shoot my dad in the head once." And Lucas never stops complaining about it whenever Magtok comes up in conversation.