Explain the dramatic irony of Duncan's reaction when he arrives at Macbeth's castle.

Dramatic irony is used whenever the audience knows more than the character, and by the time Duncan arrives at Macbeth's castle, we certainly know a great deal more about his fate than he does. He compliments their home, saying, "This castle hath a pleasant seat. The air / Nimbly and sweetly recommends itself / Unto our gentle senses" (1.6.1-3). He would not think this castle so "pleasant" and sweet if he knew that its occupants, his friends and subjects, were planning to murder him that night. 

Further, Duncan calls Lady Macbeth his "Fair and noble hostess" (1.6.30). He is unaware that she is, even now, feigning her loyalty and desire to serve him. She claims to be grateful for "those honors deep and broad wherewith / [His] Majesty loads [their] house" (1.6.21-22). But, as the audience knows, she is in the process of plotting how best to stab him and frame his chamberlains so that her husband can ascend to the throne.

Dramatic irony here (as is often the case) is used to heighten the tension for the audience. We know the truth, and we know how completely trusting Duncan is, and so this really ramps up our anxiety as the evening progresses.