You can spin it whichever way you want.
Arsenal are 6th at the moment, but they're typically a consistent Champions League side and Walcott has played almost 400 games for them (scoring over 100 goals), so he's clearly a seasoned pro at that level.
We're not at that level yet (we're nowhere near), and until we are, we need players who can push us towards that level. We can't expect to sign first-team players for CL clubs, because why would they come to us?
Walcott isn't a marquee signing, but he's got it in him to do a job for us and he'll give us some attributes we're massively lacking in - pace, width and a few more goals.