Yeah, I imagine that an independent CA would be quite a bit more liberal than it is now. From what I can tell, this is the intention of the leaders of the movement. You write

The only way I could support such a thing is if the entire union were to agree to a pared down Federal government, but remain a political union nonetheless.

If the cal exit thing really gains traction, it's going to shake up a lot of the way things work whether it's successful or not. In my optimistic moments, I imagine it spurring a broad conversation about how we could all benefit by restructuring the whole country's governance; this could lead to drafting a modernized constitution, a more sensible approach to the urban/rural dichotomy, a better distribution of power between the Federal and State governments. But maybe I'm just being optimistic...