I have a player who is planning on taking a skill utility power as his choice at level 2, however the online character builder is allowing him to take two at this level because he is a wizard. Is this how it actually works or is this a case of the character builder getting things wrong as I had thought that a wizard's two utility powers could only be arcane.

Skill Utility Powers are not Spells, and it makes no sense to talk about writing one of them into a Spellbook and not being able to use it on the days when your Wizard Utility Spell is memorized. A Wizard is free to choose a Skill Utility Power, but that would be his only Utility Power at that level. The Character Builder is often useful for settling matters like this, but in this case I feel confident that it is wrong.

That was my first instinct as well, so thanks for the confirmation on that.