Step 1: Understand Archaea.
Archaea are prokaryotic microorganisms that are distinct from bacteria and eukaryotes in terms of cell wall composition, membrane lipids, and genetic machinery.
Step 2: Analyze pseudomurein.
Some archaeal species possess pseudomurein in their cell walls. Pseudomurein resembles peptidoglycan structurally but differs chemically. Therefore, option (A) is present in Archaea.
Step 3: Analyze S-layer.
Many Archaea possess a paracrystalline surface layer called the S-layer, which provides protection and structural support. Hence, option (B) is also present in Archaea.
Step 4: Analyze circular chromosome.
Like bacteria, Archaea generally possess circular chromosomes as their genetic material. Therefore, option (D) is a characteristic of Archaea.
Step 5: Analyze peptidoglycan.
True peptidoglycan is a characteristic component of bacterial cell walls and is absent in Archaea. Archaeal cell walls contain pseudomurein or other polymers instead.
Step 6: Compare all the options.
Among the given options, peptidoglycan is the only feature absent in Archaea.
Step 7: Final conclusion.
Therefore, the characteristic absent in Archaea is peptidoglycan.
\[
\boxed{\text{Peptidoglycan}}
\]
Hence, the correct answer is option (C).