Their victory in the Champions League brought fresh air to the Premier League, it increased their morale in the game. Especially now that they have a very big chance after Arsenal were held to a draw by Liverpool in their last game. Leicester shouldn't make it difficult for Manchester City with what they've shown this season, and betting on Manchester City will be profitable.
Indeed, no one thinks that Manchester City will be complicated by a team in the relegation zone like Leicester. Apart from that, Manchester City is now getting better motivation after being able to win the first leg of the Champions League which took place at home and the match in the near future against Leicester will also take place at the Etihad Stadium so I also don't think that match will be difficult for Manchester City who now still have the opportunity to catch Arsenal's points at the top of the standings.
Arsenal's last success was about 20 years ago, but they were really good back then. They also reached the final in the CL. I can remember that they even became undefeated champions without losing a single match. But Manchester City was nowhere to be seen then, they only got good after the capital injection of the sheikh from the Middle East. But Guardiola has made it a nice team. Individually, PSG have many more stars, but City play exactly the way guardiola wants football to be played. Still, the title of Arsrenal is certainly not a certainty. Difference with City is 5 points. 1 defeat and a draw and they are level again.