I'm still not done fiddling about with it, but here's the official seal of Arkham as it stands.
The reason for the various elements, and their source:
The latin border text marks the year of Arkham's incorporation. It's taken directly from the phrasing used in Salem's seal, the acknowledged inspiration for Lovecraft's fictional city. As far as I can tell there are no canon sources for the date of incorporation, so I added two years to Salem's. Given that Arkham was founded shortly after Salem I thought it appropriate that it's incorporation follow suit.
The crown in the top of the inner circle references Arkham's founding as a plantation during the era of royal land grants. The graphic is taken from the town seal of Haverhill.
The ribbon and shield design is a common heraldic device used by a multitude of Massachusetts towns. The shield with three segments is based on the four segment shield in the Plymouth town seal.
The plow and sheaf of wheat in the upper left of the shield signifies Arkham's origin as an agricultural colony. The graphic is a retouched version of the sheaf and plow found in the Dover town seal.
The three masted schooner in the upper right references Arkham's seafaring history, primarily trade with the Indies. The image is a retouched version of the ship found in the seal of Falmouth.
The building at the base of a hill in the lower shield is a depiction of the academy (created by the Orne bequest) that would eventually become Miskatonic University. The school became the town's major economic engine after the Revolutionary War, a fact I believe the town fathers would find worthy of commemoration in the seal. The building itself is a retouched version of the meeting house in the Dover seal.
The two branches of greenery on either side of the shield are cranberry sprigs, inspired by the ones in the Falmouth seal. The pristine river valley where Arkham was founded surely had bogs filled with native cranberries. The sprig on the left, with it's branches and leaves forming Lovecraft's Elder Sign, is the only "wink, wink, nudge, nudge" element in the design.
I welcome your comments and suggestions.