Lonny Hurlbut, the colorful police chief of the tiny city of San Juan Bautista, was arrested for allegedly brandishing a handgun in an altercation on Monterey's Cannery Row. The case is under review by Monterey County Dist. Atty. Michael W. Bartram, who will decide whether a misdemeanor charge should be filed. Hurlbut was briefly suspended from duty last April after a drunken brawl that involved other city officials. Hurlbut said he was trying to protect a woman friend from some men yelling sexual obscenities. "I pulled out my badge. . . ," he said. "I took out my revolver and set it on the (car's) dash and said to the men that if they didn't get away, somebody was going to get hurt. . . . They finally backed off," he said, when he pointed the gun in the air. "I probably did what any other male would have done in such a situation. . . ." Hurlbut, who was booked and released, added: "It is unfortunate, and I wish it had never happened. Why is it always me who lands in the newspapers?"