Variegation in plants sometimes IS caused by a virus. I've not seen variegated hydrangea foliage quite like yours, but I'd not necessarily be inclined to remove it. Other factors can be the cause of the both the markings and the deformation -- any chance of any herbicide sprayed in the area? What is the cultivar.....H. macrophylla 'Mariesii Variegata'?

I guess it must be 'Mariesii Variegata'. I got it at a nursery somewhere in redwood city, and I don't remember even the name or if I made a note or if it was marked. It's not in great soil. I used to have a lawn there, and I was trying to add plants to that area. I had it in front, but had to move it to the back, because it had grown too large for the front area. I did amend the soil a lot, before planting, but I guess that was not enough. But, I am sort of glad it's not near the other hydrangeas in the better area. I had to use round up to take out the lawn, but I am probably going to get rid of it today. It's not worth the risk. I looked up hydrangea virus and there is such a thing, but I could not find a photo of it. I would think round up would kill the plant, not cause a leaf color change. Anyway, it no longer looks cute. I don't have any photos of it in the in-between stages, because it always had a leaf fungal thing going on every summer, so when it did bloom, the leaves were too ugly to photograph. I don't know how long to suffer with a poor performer like this, when I have two good hydrangeas and I want two more to add to my collection and limited space.

I just found:

Hydrangea Chlorotic Mottle Virus
The symptoms of HCMV infection include mottling (random patterns of light green, green, and yellow), reddening of leaf tissue, and curling or deformation of young tissue. Hydrangea Chlorotic Mottle Virus infects only cultivars of Hydrangea macrophylla. This includes 'Endless Summer' 'Nikko Blue' and 'All Summer Beauty'. The virus will not infect cultivars of Hydrangea paniculata, (eg. 'Unique', 'Pink Diamond' and 'Limelight') or Hydrangea aborescens (eg. 'Annabelle' and 'Grandiflora'). In examining the virus, plants from seven different families were tested. All plants were resistant to the virus except H. macrophylla.

The virus can be spread by green aphids (Myzus persicae), through propagation, or through mechanical damage that might occur in splitting, transplanting, or pruning infected and healthy plants with the same equipment. What long term effect the virus has on plant health is unknown, but it is suspected to play a role in poor survival of H. macrophylla in some gardens.
I think it may already be too late, the other two hydrangeas may already be infected, but I can only hope. I am getting rid of this one today. I am just posting this so others can be warned. I really have all the virus bad luck, first the hosta virus, then I thought the canna virus and now a hydrangea virus.

Here is a link that might be useful: Hydrangea Chlorotic Mottle Virus

I would be tempted to send a leaf sample to someone in your Agriculture Extension Service or a nearby university for analysis.

Contacting such agencies has always been a disappointment in my area. People are not friendly from such agencies and get too many requests and ignore them all. They are all too busy with what ever important research they claim to be doing. Emails, phone calls, voice mails are never replied. I am referring to those institutions that are located in Golden Gate Park. They are mainly focused on tourist dollars.

Are you sure you've been contacting the right place? The extension service offices are intended for both home gardeners as well as agricultural questions. Plant ID and diagnosis of pest and disease problems is one of their primary functions. They are staffed and funded by the land grant colleges (UC Davis in your case) and have nothing to do with tourists and are not for-profit enterprises.

FWIW, the Master Gardener programs are under the auspices of the county extension services and they often offer plant clinics at local nurseries. Better nurseries also typically have horticulturists on staff that can provide the same diagnostic function.

Here is a link that might be useful: San Mateo/San Francisco county extension service.

I have taken the hydrangea out. I looked at the link that is a pdf, but I don't see a contact email or phone number to call. I will have it around for a while, but understandably I am anxious to be rid of the virus material, since I do have an endless summer and another macrophylla. So, if I can find a contact before garbage collection day...

I emailed someone from the nursery business who thinks it looks like a virus, so I want everyone to look very carefully at the photos. I put the plant out with the city collection. It did not burn it, because we are not allowed to burn vegetation in San francisco. So I don't have the plant anymore, I just hope the others that are solid leaf macros have not picked up the virus.