The Sabres didn't take him to arbitration. Kennedy elected to go that route. Kaleta was the one Buffalo took to arbitration, but he agreed on a deal before it went that far. The Sabres had no choice in the matter, once Kennedy chose to do so, they were locked in. They couldn't walk away from the deal either because the CBA doesn't allow a team to walk away from a deal that low.
That said, this is a very strange move and there has to be more to it than we'll ever hear. I'm guessing that during the process, Kennedy pissed them off a bit.