I think that Arnold can too act, even if he sometimes hams it up. There are far worse actors than him. He has a unique style, he has an incredible screen presence, he understands character cause he studied psychology at 15. He actually explained in a documentary how he used it to defeat his bodybuilding rivals.
I once too thought he was a bad actor, but now I actually admire the guy. Because you can see how in many of his roles, even if the movie is not exactly top notch, he does try to give a good performance.
Too old? Maybe. So I won't say I think this project is a good idea.