I happen to have a Bulgarian version that does not specify if the player can destroy 1 enemy building, while sacrificing it, or the whole city. It's hard to explain, but I think it was translated by someone unfamiliar with the exact Bulgarian meaning.
What does the English version of the card say?
From this thread on BoardGameGeek, someone posts:
The card says:
During your turn, you may destroy the Armory in order to destroy any other district card of your choice in another player's city.
The Wikipedia page for Citadels refers back to that thread.
Later in the thread, the game designer (Bruno Faidutti) mentions that the ability to destroy one district can be used when a player builds an eighth district (which would end the game at the end of that round), even though normally you can't destroy a district in a city that's already completed.
BF: I admit the rules are ambiguous on this, but my idea was that it is allowed.
Q: Would the game still end, as the card says the game ends after the turn, even though the condition is no longer met?
BF: Yes, it would.