The problem is that you only embedded the normal font weight for the Arial font, and by default the Button control’s label is bold. You have two options:
1) Set the button’s label to use normal font weight instead of bold by setting the fontWeight style:

<mx:Style>
    @font-face {
        src: url("fonts/Arial.ttf");
        fontFamily: ArialEmbedded;
        fontStyle: normal;
        fontWeight: normal;
    }

    Application {
        color: white;
        fontSize: 12px;
        fontFamily: ArialEmbedded;
    }

    Button {
        fontWeight: normal;
    }
</mx:Style>

2) Embed both the normal and bold font weights in your application:

<mx:Style>
    @font-face {
        src: local("Arial");
        fontFamily: ArialEmbedded;
        fontStyle: normal;
        font-weight: normal;
    }

    @font-face {
        src: local("Arial");
        fontFamily: ArialEmbedded;
        fontStyle: normal;
        font-weight: bold;
    }

    Application {
        color: white;
        fontSize: 12px;
        fontFamily: ArialEmbedded;
    }
</mx:Style>

Peter

@font-face {
src: url(”fonts/Arial.ttf”);
fontFamily: ArialEmbedded;
fontStyle: normal;
fontWeight: normal;
}
Application {
color: white;
fontSize: 12px;
fontFamily: ArialEmbedded;
}

And the Button text defaults to some gross serif font. So i tried

Application, Button { …

And still nothing. So I just tried

Button {
embedFonts: true;
fontFamily: ArialEmbedded;…

Still doesn’t pick up the font. Still the serif.

Thank you.