Since you talk of case hardening, I assume the arms are made of mild steel of some kind.
In that case, I don't think you'll need to allow for any expansion when heat treating. High-carbon steel (O-1 or whatever) expands a little when hardened, but I don't think case hardening mild steel will make enough difference to worry about.
Read the directions on the Kasenite for proper use. You might get away with a big propane torch, but you'll need to get the parts you're case hardening up to about 1750 degrees or whatever before quenching. A propane torch may have a hard time doing that because of the size of the pieces. Oxyacetylene will do it for sure--the danger there is overheating, though. You don't want to burn up the parts.
See what the Kasenite directions say about a quenching medium (oil or water).
I think I'd follow the lead of lynnl and use dowel pins for the axles.
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