bug isn't fixed! I started today, have done every other quest available without an issue, have run through that entire tower and killed everything atleast 3 times and no "Arachne". I'm guessing she should spawn in the room with the carpet? this could be because of another glitch near the area but 3-4 spiders spawn on top of each other near that room along the lower path leading to it. you can kill them off 1 at a time without any of them being able to move.
as this quest seems to stop you from finishing another quest also(Missing Girl quest) its sort of game breaking as no one else offers quests besides the guy that gives you that quest.