I think SpaceMan was asking if the image you shared was just the nose cone, or if that is the entire rocket. His point is a good one- even with active stabilization you will want a margin of safety in terms of CG/CP ratio, and what you show is probably not inherently stable.
I love the arduino and have a couple of ideas rattling around, but mostly around data logging. Your project sounds very interesting; what I've read on the DOF modules is that they can be tricky to implement. I wish I had something better to offer, but good luck and I'm excited to see what you come up with!