How do I make the walls go up when the ball reaches a certain height?
Talk to them nicely. Usually walls aren't too keen to move if you shout.
You could make a boolean game attribute called "wallFlag". In the ball actor, when it reaches the y position you want, trigger the flag. Then in the wall actor make a rule that when the "wallFlag" is true, move the wall to the position you want.
This could help use the arrow keys to move up and down