The code word is only part of the response process to an inflight problem.
Once the problem has been dealt with, diagnosed and a plan of action devised by the flight crew, they then issue the 'code word' to the cabin crew to brief them on the situation. After this, an announcement is then made to the passengers to inform them of what has happened and what the plan is.
With this sequence, the cabin crew will then hopefully be able to answer as many questions from the passengers having been briefed by the flight crew as opposed to answering with 'I know as much as you'
The flight crew's priority is to fly the aircraft, everything else, including keeping the passengers informed comes second. There's no prizes for making a wonderfully informative PA to the passengers as soon as the problem has occurred and then fly the aircraft into a hill.
In practice, the PA to the passengers is made pretty much as soon as the cabin crew have been briefed by the flight crew so there would only really be a few minutes tops between the issue of the code word and an explanation of the situation to the passengers.
Mountains and molehills seem to spring to mind here.