I have the Mongoose book, and have flipped through the Arms & Equipment Guide, and I can say hands down the Mongoose book is FAR superior. The A&EG is very pricey for the page count, and many of the items are too outlandish for use in most games. In addition, the vehicle rules seem to be of very limited use- I don't think once since 3E came out have I needed such rules.
On the other hand, the Mongoose book draws from over 30 OGL sources, as well as having a bunch of new items. The items are grouped by class: arcane sorcery, temple items, armory, dwarf's forge, rogue's tools, wilderness gear, food drugs and herbs, psychic mastery, fighter's gear, tools, and items of the orient, as well as several other chapters I don't remember off the top of my head. There are also master equipment tables in the index. There are not a lot of magical items, but tons of mundane gear that would be really useful in actual gameplay.