Take a look at the turtlebot arm installation tutorial, section 1.5 "Add your arm to your turtlebot". As explained there, you need to add a turtlebot_arm macro to your URDF, and set origin for the arm base relative to the base_link of your robot.
UPDATE
Here is an example of how to integrate the turtlebot arm in a robot: attach a white and black arm at <0.10914 0.0295 0.0284> relative to the plate_top_link; use standard turtlebot_gripper. If you have instead a pincher_gripper, flip the true/false in the _gripper parameters.
UPDATE2
Here's the example of the previous link:
<turtlebot_arm parent="plate_top_link" color="White" gripper_color="Black"
pincher_gripper="false" turtlebot_gripper="true">
<origin xyz="0.10914 0.0295 0.0284"/>
</turtlebot_arm>
either pincher_gripper or turtlebot_gripper must be true. For the rotation, as you can see attribute rpy is missing, so the arm should appear with default alignment, if all the joints are set to 0. You can set a different orientation adding
rpy="${M_PI/2} 0.0 0.0"
to origin for a 90 degrees rotation. Can you post a picture to see what do you mean more precisely?
I'm also having an issue with this. Adding the code snippet found in the github readme to the "xacro-macro-magic" URDF which I assume is turtlebot_library.urdf.xacro doesn't make the turtlebot + arm appear in rviz when roslaunch turtlebot_arm_moveit_config turtlebot_arm_moveit.launch is run