You mean to say Skyrim?
Also, have you tried scrolling with your mouse wheel? I wonder if that would work. If navigating menus actually requires arrow key usage, this seems like an absurd oversight.
Actually, on second thought, what seems more likely is that they want to take out any advantages that the PC version has over the console version, and level the platform playing field a little bit (gamepad menu navigation is equally clunky to keyboard usage), to encourage people to choose a console version of the game over PC. Why? Simple -- piracy. PC games are MUCH easier to pirate than console games. Less piracy = more profits.