Okay, I reinstalled Arch rebooted and tried:
Output:
I get a lot of:
I thought thats what the 'y' option did, what am I doing wrong now.

Should I just download the latest Arch?

Shouldn't need a re-install. Maybe try re-ordering the server sites (pacman.conf ??? - guessing here, been a while) to get a site closer to you.

The server sites are in /etc/pacman.d/"INSERT REPO HERE"

The way they are ordered shouldn't be a problem. It selects the fastest one anyway, it just reads through them to find it. Besides, the offical repos should be pretty fast anyway.

First, try running "pacman -Sy" and if that doesn't work...

Are you connected? Why did you reinstall? Are you running pacman as root?

Just so you know, the only difference between what you have and "the latest release", is just the updated packages. Arch works off a rolling release system so there won't be an benefit. It really sounds like a network issue to me. You are having problems connecting to the network. What happens if you add another repo to the list in /etc/pacman.conf?

I reinstalled because I wanted Arch on a different partition. I know it doesn't really matter and I am just trying to learn more about linux in general so I thought a reinstall to the partition I wanted would be good practice for me. Also, I have done a lot of changes to my old Arch install and I got a little lost . So now I at least know where I am starting at a clean install! In fact I just installed Arch 0.7.2 in place of 0.7.1.

On to the trouble, I have 0.7.2 installed at /dev/hdb8, and can boot into it just fine. When I try to use pacman -Syu or -Sy or anything else for that matter I get the same message 'Resource temp. unavailable'. I KVM over to my other tower and can browse the ftp repositories, so it does sound like a connection problem.

I ran ifconfig and all looks good. I can ping my router, and other pc's on my LAN and my other pc's can also ping my Arch install. So, what do I need to do to pacman working?

/edited because I can't type.

Are you running are firewall? In any part of your router.

I thought of this and placed my Arch pc on the DMZ to avoid any issues, with no luck.

Mmmm - that might be the official line.
For an Arch VMWare image I have at work, I couldn't get any connection until I re-ordered the Australian site first. No problems since.
Merely my experience.

Hmm.. odd.. I've installed Arch numerous times but never had an issue with it.

I guess different networks different problems. You might want to reoder to /etc/pacman.d/current and /etc/pacman.d/extra files