Thanks all for your replies!! I got a chance to talk to the avis agent today when I returned my car while waiting for a ride back to the office. He confirmed that yes, if you return it to a different location, even if it is intra-california, it recalculates the entire rate on the contract. So if you want to avoid any surprises, then actually enter the one way rental when booking, and it will save you a lot of money at the end of the day.

Great forum - keep it up!