The Gunners host the defending champions needing a victory to close back within striking distance of the top four.
City, meanwhile, cannot afford another poor showing at Emirates Stadium - where they have never won in the Premier League - if they are to hang onto the coattails of Manchester United, who host Liverpool in Sunday's lunchtime kick-off.
Wenger admits anything other than a maximum-points haul will do either side's ambitions little good.
"I think they are in a situation where a draw will not be good enough, and we are in the same situation," said the Arsenal manager.
"The fact that both teams have to absolutely go for a win promises a more open game.
"When you are in that (title) situation, you don't want to drop more points because it can be damaging for your chances."
Wenger added: "It (the championship) is still very open. When you watch the games, no team today goes into a Premier League game and is sure to win it, therefore I believe every team can drop points.
"It is much more open than people think it is."
Talk of a sustained title challenge from the Gunners may be pure fantasy once again following too many inconsistent performances, but Wenger knows his men cannot afford to start a run of potential season-defining fixtures with anything other than the required performance against the champions tomorrow.
"At the moment we are still trying to shorten the distance between us and the top," said Wenger.
"The players are ambitious. This group has a fantastic attitude.
"They were not always playing in a positive environment, so it was not easy for them, but I could not for one day fault their concentration and focus to do well.
"I want this group to be rewarded and hope we can show that in the coming months."
Arsenal have seen the likes of Kolo Toure, Emmanuel Adebayor, Gael Clichy and Samir Nasri all leave for bigger contracts at City in recent seasons.
Wenger accepts having to battle against the seemingly bottomless pockets of super-rich owners is now part and parcel of the modern game, although one which will eventually be brought into check through the introduction of financial fair play across Europe.
However, the Arsenal manager refuses to believe it is just all about who has the biggest cash pile.
"There are different ways to be successful in football. Money helps, but it is not the only way," said the French coach, who transformed the Gunners into one of Europe's leading clubs in his 16-season tenure.
"I believe that the names of a club are built up through consistency of their attitude and behaviors, clubs like Arsenal and Man United or even Man City, who are 100 years old or more, that's the consistency of the quality of their work that makes their name."
Wenger, though, feels eventually the tide will turn towards clubs living within the income which they generate.
"I do not complain. I am happy to work within the conditions we have set, slowly everybody will get there," he said.
"The future anyway is where we are. It cannot go on a different way because in England you will have financial fair play, in Europe you will have financial fair play.
"What makes sense if you spend the money you earn, in life it is like that, for you and for me."