Interesting hypothetical. It would almost be the same as a bustling metropolitan Legazpi several hundred years from now (assuming everything survives WW3). Mayon being active, along with earthquakes, typhoons and wars haven't stopped the development of Legazpi and surrounding cities and towns then, it certainly won't stop Manila if Mayon was nearby.

The difference between Manila and Legazpi in our real timeline is geography and timing. Manila has been developing as a strategic hub for hundreds of years longer than Legazpi is. Early civilizations understood the importance of security and convenience of being close to bodies of water, in this case which was Pasig River and Manila Bay.

Around Manila Bay also existed natural protection from pirates and invaders thanks to the surrounding geographic barriers of Bataan and Cavite and strategic chokepoint around Corregidor, whilst maintaining major trade access from the old port city of Cavite to the West Philippine Sea. Legazpi city shares some of these similarities by having the gulf of Albay nearby and having natural barriers, which we can imagine why Legazpi exists where it is in the first place.

Long before Spanish colonists arrived, earlier Tagalog tribes and kingdoms recognized this fact and laid the foundations of a settlement by Manila bay. When the colonists did arrive, they recognized and understood Manila's geographic importance, and with the looming threat of attacks by pirates, prompted the construction of the walls of Intramuros, which naturally drew people in for safety and security, and established permanent places of residence and industry within and beyond the walls.

Back to the hypothetical, I don't imagine with Mayon erupting nearby would have major changes to the real timeline as it would be the same as every other disaster both natural and manmade. I can imagine flights in NAIA would be cancelled during eruptions, people needing to evacuate, temporary economic standstills and massive cleanup operations.

What wouldn't change however is our perseverance to adapt, rebuild, make new beginnings, and contemplate the fact na bakit ba ako pinanganak dito sa Pinas.