Thanks for your reply.
I see the same settings under Arena 6 as you do.
SoundFlower does show up in Arena 5 too but does not seem to pass the audio through.
I created a Multi-Output device in the Audio Midi Setup application with both SoundFlower and the Build In output active just to check if iTunes can be heard.
I tried another user (with admin rights) on the same machine to see if any prefs where corrupt.
I tested both Arena 5 & 6
I removed and reinstalled the SoundFlower kernel extension.
I checked the gain settings.
What other application do you recommend to check SF with?