Used to be good, but Google hates that kind of stuff and will not hesitate to fry your account should they find a reason to. For the most part, I think AdSense arbitrage is a thing of the past. I'd focus on something else.
One must first understand how keywords and Adwords work before going into this venture. It is risky, though.
You can make some good money with this using MIVA. Buy their keywords for .05 and send them to sites that pay $1+ Not that hard to do really and if done right you can make big money with very little traffic. good luck...
Now arbitage is not so profitable like previous days because now we can not use adsense on lading page which link we will use while advertising via adwords . So their is less chance for earnings too .
i am using it from past 6 months, high high profitable. but my site is not for adsense only. it is for users. they visit, they stay, they come back again. google has no objection.
Whew. Better be careful. Like salman4raza said, make it a content filled site. Don't have it looking like it was made for AdSense. They will ban you and not give it a second thought.