I have also heard of problems with Olympic transfers. Last year, I met a couple who had arrived at Corfu airport at 2.00 a.m. and arrived in Arillas at 7.30 a.m!!
I would definately ask the rep if Arillas is going to be first or last drop off point and if the answer is not 'first', get a taxi (- about 50 euros).
Angie
p.s. I reckon it will be still dark when you arrive, but dawn will be breaking as you get to Arillas - beautiful time of day for your 'first impressions' - a cup of coffee sat on the balcony whilst you drink in the view, the smells , the sounds and atmosphere, and let the feeling of total relaxation just wash over you, then a couple of hours sleep before a cooked breakfast around 11.30am (at any of the tavernas), before collapsing on the beach.
Heaven.