Will our arena ever stop being crossed with other servers?

No

Why can't I matchup with my friends from same server? How can we do that?

You have to be close to the same level in ranking. The further you are apart in ranking, the longer it takes to eventually match, if ever. So if you are Super Kage, you will likely never match someone at Genin Ranking. But if one of you is Super Kage and the other is Kage, eventually you should match. The game will try to match you at the same ranking first though. So if another Super Kage shows up, it will match that first before matching you to your friend who is at Kage.

You also can't be negative (-2). Once you go negative, it tries to match below only. You'll have to win to reset that count before it will try to match up again. It's setup that way so you can't just easily use friends/alts to boost yourself through ranked arena.

Will computer controlled teams form our server ever return like they used to be?

No.