A city will only be deleted if:
- It has been inactive (not logged in to) for at least 30 days, AND
- It has not reached Chapter III (Researched Advanced Scouts in that Chapter), AND
- Has not purchased Diamonds. If the Diamonds have been spent, the purchase still counts.
As none of these criteria can be determined by looking at the city (except in the case of those cities with a permanently upgrading Main Hall, which is a sure sign of inactivity), we have to trust that the system is working.
Given the number of tickets we receive from people who have to start over again after taking a holiday, I am pretty sure the system is working properly. It may not be the best, but it is working.