My meter reads 120 v between hot and neutral, no voltage between hot and ground and arc fault between neutral and ground. Outlets work OK but I found my tester reads open neutral on every outlet in my house.

Using a meter is the best method, you should read 120 volts across Hot and Ground, same as Hot and Neutral.

You either have no equipment ground, or it is broken and open.

Continue to use the meter to check this, I do not have much faith in the plug in testers.

If you use a Wiggy, it may trip the ARC fault, if measuring between the Hot and ground?

I can't check voltage between ground and neutral because of the arc and tripping the breaker. My meter probe on the ground almost burnt off.

Odd.

Best to disconnect all wiring from the panel so a continuity test can be done between all three conductors of the circuit, hot, neutral, and grounding.

Need to get to the basics before any other testing is done.

Sounds like something is crossed or touching in the circuit..

There should be no reading between any of these wires. If there is, then a light bulb may be in or an appliance is on. Unplug everything in the circuit, and remove any light bulbs. Shutting off switches should help. No device, appliance, or lamp can be in the circuit to be sure the circuit is clear.

If all is clear, and the continuity still exists, then the circuit needs to be checked segment by segment cable to box, etc until all is clear.