Andrew Sullivan has the correct analysis in the link I provide in the title.
The California legislature (not 'activist judges') passed a resolution to recognize SSM in California. Arnie based his veto on the false premise that the Prop 22 vote indicated Californian preferrence for no SSM.
This is of course, false. All prop 22 was about was recognizing out of state SSM in California.
All however, is not bleak. Arnie's regime has proved to be so corrupt and ineffective he does not look likely to be re-elected. A democratic Governor backed by the Legislature would have a significant likelihood of getting that legislation passed.
At the end of it all, Arnie failed to back human rights in favour of his fundamentalist Republican base.
And that will doom him to being a one term Governor.