Here's my two cents worth.
Having driven both cars a lot, I must say that the Mazda is far far superior than the City. For one the Mazda suspension is a lot more sophisticated and there is huge difference in the way it handles and rides. We had two Mazdas, now have one.
The 1.5 gave us 10km/l flat in the city(not the car ) in traffic. The 1.6 we have now gives us 9km/l.
Did lots of KMs in Thailand many times over many years. Not one bit impressive even on their smooth roads and highways.
I really don't think there is a comparison here as the cars are from two different classes. The 323's proper rival is the Civic not the City. The City's rival should be a Demio/Mazda 2 sedan if ever there was one!
I would go for the Mazda.