If you are not using ibProArcade v2.7.2+ then yes, you could have been hacked through your arcade. This has been discussed here, you should have received an email regarding this if you marked this addon as installed.
Update your arcade.
If your backups are corrupt, that is an issue with your host, not this addon.
If your arcade is the only pages on your site that are screwed up, completely uninstall it, including all files that came with it and install the latest version.
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