"who's going to put together a substantial application if they're unsure if the language will survive?"
This is true if you're writing your application for commercial use, but if you're doing it just for fun you can even use a language written by yourself that no one else know. The biggest problem is the lack of development and debugging tools. I few weeks ago I started a project to learn a bit more about compilers, and I ended up using Common Lisp because the task was very difficult by itself and I needed a good way to debug the program. Using Arc would have meant to make a difficult project even more difficult.
I think you just proved my point. I presume your project to "learn a bit more about compilers" was not commercial in nature, and yet you chose Common Lisp. Whether a project is for fun or for profit, I'd prefer to not waste my time, and it appears you feel the same.
I think the survivability (not popularity) of a programming language is closely correlated with its usefulness to programmers.
Of course, the best way to rebut my implicit assertion is to actually "put together a substantial application" with Arc instead of talking about it, right?