Doesn't seem too difficult to get a 'free' license and pay the occupancy tax. I've stayed in various beach rentals along the California coast for 2 weeks at a time and have been charged occupancy tax.
At that link, you'll see "Monterey County Planning and Building Inspection Department requires Homeowners wishing to pursue short term residential rentals (7-30 days) to obtain an Administrative Permit."
County of Monterey
Non-Coastal:
Administrative permit required for rentals less than 30 days in R-1 zoning district
Minimum rental period 7 days
Zoning Ordinance 21.64.280
Coastal:
Contact: Planning and Building Inspection Department (831) 883-7500
I'd guess that the county is easier to deal with on this than the various cities (where the hotels and the bulk of the housing are).
http://www.co.monterey.ca.us/taxcollector/TOT.html