The midi support in aRts can do a number of things. First of all, it allows communication between different pieces of software that produce or consume MIDI events. If you for instance have a sequencer and a sampler that are both aRts aware, aRts can send the MIDI events from the sequencer to the sampler.
On the other hand, aRts can also help applications to interact with the hardware. If a piece of software (for instance the sampler) works together with aRts, it will be able to receive the MIDI events from an external MIDI keyboard as well.
Finally, aRts makes a great modular synthesizer. It is designed to do exactly this. So you can build instruments out of small modules using artsbuilder, and then use these instruments to compose or play music. Synthesis does not necessarily mean pure synthesis, there are modules you can use to play samples. So aRts can be a sampler, synthesizer, and so on, and being fully modular, it is very easy to extend, very easy to experiment with, powerful and flexible.