Definitely by city, not code.

People who know the code will always also know the city. People who know the city might not know the code.

Also, when you set it up by city, I'd suggest adding cross-references to the cities in the Featured Regional Airport list. People who want one of them might not think to check that list before they head for the geographic section.

[edited to add new suggestion]

[This message has been edited by Efrem (edited 07-08-2001).]