How about a manzanita, perhaps 'Emerald Carpet'? It's a very nice native ground cover. I haven't grown it myself but I've admired it in other yards and I'm guessing it would do well in the environment you describe.

Here is a link that might be useful: Arctostaphylos 'Emerald Carpet'

Thanks Cowper. I like that it attracts hummingbirds.

FYI, while I love the Emerald Carpet, I found it to be difficult to establish in the San Jose (sunset z16/17) area and others I've talked to have had similar experience.
I planted around 30 or so to get 7 that lived and of those 7, only 3 are thriving while the remainder just sit there and survive (they are around 5-6 years old.

You may have better luck in your microclimate and they do beautifully in the Santa Cruz mountains and along the coast.
You will also have better luck if you plant them between Oct. and Jan. rather than planting now. Most natives prefer to be planted between late fall-early winter.

There are also some low growing Ceanothus varieties that you might want to consider. My favorite is 'Centennial', but it also likes a bit of afternoon shade to do well inland.

wanda