The arc is due to the panoramic shot. If you take masking tape and put it on a straight line on your ceiling and then take a pano, you'll have an arc.
I arrived here because I thought I'd find a milky way pic where you could see the earth surrounded by the whole donut (milky way across the whole horizon in a pano, with the bright center on one side and the doughy exterior on the other), but there don't seem to be any of those photos.
For example, if you then take masking tape and put it at eye level across 360 degrees of your room and take a 360 degree pano, you will have no arc. Yet it seems like this case never exists on the horizon in the world of milky way photography.
It is always curved, in other words, and this can be seen here, where the milky way is close to the horizon in a pano and still curved. In fact, it looks as if we are in a high elliptical orbit looking down in the disc... which I don't think we are.
Without getting into details and because I am getting trolled (see comments) there seems to be reason to believe that there will be extra curvature in some circumstances. We'll call it aberration.
For that reason, pictures like the one above will always be arced and never have the milky way stretching through the whole pano along the horizon, I guess (or not).
There is also this wacky article that significantly muddies the water:
Milky way is MORE warped than astronomers thought (a floppy sombrero)
As a skeptic (or rather cynic), it is unclear where the gravitational lensing starts and the mistakes stop, but there seem to be many contradictions related to how the milky way ought to look as a general matter.
Interestingly, the floppy sombrero milky way article and flat views of the milky way (accepted answer as of 5/2022) contradict themselves, and the contradiction helps illustrate the power of
cv2 to warp a milky way image to whatever shape you need.