GeoPlanet doesnt seem to return the city name unless you specifically search for a city name. For example if I do a query for "space needle" I get King county, Washington, USA but nowhere in the results is the city name. Do I need to add another parameter to my request to get this data?
GeoPlanet does indeed return the city name, which appears in the 'locality1' element. However, it looks like you've highlighted a bug here, where the neighborhood appears to be showing up in some circumstances. We will investigate.