I thought your post was rhetorical. Where did you get that "if you wish to live in peace" bit?
'Holiness to the Lord' is probably inscribed because historically, the Holy Royal Arch was considered the completion of the Craft degrees. The Royal Arch is set during the rebuilding of the Temple of Solomon, and (per Exodus 28:36, KJV), this was to be inscribed upon the breastplate of the High Priest.
"Vide, Audi, Tace" is probably inscribed because it is the motto of the UGL of England. See
http://www.grandlodge-england.org/ugle/coatof-arms.htm