Excellent question! I used to have my students do this activity when I taught science. I believe you are definitely on the right track by having the nucleus represent City Hall.
Since we know DNA resides within the nucleus and has all the information and instructions for the cell, there are a couple different ways you could look at this analogy.
First, I think you are correct when thinking of DNA as the "laws" of the city. DNA really is the information that everything else in the cell has to go by, which in my opinion, would be a great representation of laws as we have them in cities. Laws contain all the information that the citizens of the city have to abide by...
While I would go with the law analogy, you could also think of it as perhaps the Mayor of the city. The mayor's office is typically housed within the City Hall, just as DNA is housed within the nucleus. Likewise, the DNA is in charge of what goes in the cell, just as the Mayor is the chief executive officer of all actions within the city limits.
The great thing about analogies like this is that you can have multiple answers, as long as your reasoning is solid. As you complete your analogy, make sure you focus on why you are choosing the representations you choose -- that's what is most important in an assignment like this!