I don't know whether you already changed it — to avoid misunderstandings, I'm speaking about the version posted on stkaddons.
The overall idea looks very nice and promising. You've got many places to play hide-and-seek, yet it may be too many: I found four totally separated areas, which makes it very hard to find your opponents in time. If you play with only 2 or 3 karts, it's not too nice: The main battle will happen in the waterfall area, but once you're left with one live, you can just run away and hide somewhere, hoping for someone else to get out first. As the border areas (such as the one player 1 starts in) only have one connection each to the main area, there is no reason to go there except to hide. This somehow spoils the virtual wideness of the arena.
Another point is the cave, and the falling water drops. IMHO they don't look too nice and don't really give a good feeling either. Speaking of the cave, maybe you could add more exits from this to the border areas, which would make the cave more important as well as allowing better hunts through the whole arena.
What I really do not like is the texture: You start in a forest besides a textured wall which seems to let you through (as it is quite transparent). However, you cannot pass it.
The only way to leave the starting area is through the thickest forest — the texture between the pillars through which you just cannot see. I'd try at least swapping these textures, making the passage easier to see.
Please don't mistake my rather harsh critique as "this arena is bad". I really like the idea and just want to help you making your track better.
