Bug was introduced from Ark version 21.08.1 → 21.08.2
I downgraded only the ark package to 21.08.1, and it no longer crashes nor errors out nor stalls when compressing anything from Dolphin’s right-click context menu. 
However, it reveals another underlying bug that was recently introduced into Dolphin/Ark: a new instance of Dolphin is launched when the compression completes. 
(I have seen this other bug report myself, and it is supposedly fixed in version 21.12.x.
EDIT: Yet with either version of Ark, compressing new archives from Ark itself (not using Dolphin’s context menu) works fine.
EDIT 2: To be more clear about the “fix”, if it truly will address both issues with Dolphin/Ark, we might not see it until December of this year. I believe KDE uses calendar versioning for some of its software in the form of YY.MM, which means Dolphin/Ark version 21.12 is likely to be released in December 2021.