Or maybe this was driven by something about building costs? Some difference specific to the San Francisco Bay that meant that they did this where other people didn't?

I didn't get many answers, but San Francisco, particularly after the 1906 Earthquake/fire, was heavily influenced by Victorian architecture. So why did Victorians have bay windows? Well, in 1894 the UK Building Act changed the regulations, so that windows no longer had to be flush with the exterior wall.

So why did that happen?

Well, back in 1774 there was a Fires Prevention (Metropolis) Act in Great Britain which restricted exterior ornamentation, most of which was timber, on the (probably very correct) theory that this was one of the things that was making fires a lot worse. And prior to that, the Mischiefs by Fire Act 1708 had similar provisions. And before that was the 1666 London Fire, which is maybe the biggest piece of the puzzle.

But after many long years of horribly flat monotonous buildings, which accumulated over time, people were hungry for something that was elaborate and ornate, and there was a housing and disease crisis and maybe drove the need for comprehensive regulatory reform. And when regulations relaxed, a bay window was one of the modifications that you could do to a building without having to start the whole thing over or drastically change the floorplan. And when San Francisco was rebuilding, this is the style that was all the rage.

There's something so beautiful and ironic about this, the line that we can draw here between the Great London Fire of 1666 and the Great San Francisco Fire of 1906.