Form Fill: If I have “city” as the field how and where do I type in the cities to make it a drop down option?
You need to edit the form and have the city field highlighted. Once you do this, change the "Field Type" to "Select". Now you can go to the "Values" section and click edit. This is where you can put in your cities to populate when someone clicks on the drop down.
Hope this makes sense,
This product doc is helpful as well and walks you through the steps: Add a Country Picklist to your Form - Marketo Docs - Product Docs
The example is for the Country field, but it should help you do the same for city!