I spent the 60s in the Bay area in college and law school and the Daly City residential areas were definitely a subject of derision.Daly City was one of the first large planned residential developments in the country and it looked different from what most of had ever seen before. The houses were not identical - but they were similar enough that when one passed them driving on the highway they all looked the same and very box like, except for the pastel colors - there was a pink one and a green one and a blue one and a yellow one etc. We all joked that after dark it would be impossible to find ones house, assuming that one could only differentiate them by color - ie the eighth green house on the left. Also for a suburban setting (at the time) the streets were set out in a grid which put the houses in perfect rows all evenly spaced which contributed to the image of sameness. All of this was exacerbated by the fact that the development was on a hillside so that it's full expanse was splayed out in plane view of the adjacent highway - so you got the full visual impact as you drove by (which is all we ever did).

What the houses were made of one couldnt tell from the highway but they had the appearance of being made from less substantial stuff than what we had been brought up in, looking like cardboard models you would get for a train set. While these days we are very used to "housing developments" with large blocks of housing all based on similar floor plans (although now a days developers take more care in having different front options and windier streets) made out of plywood and sheet rock, back then we were not and it was indeed a jarring sight.   

My recollection is that it was more middle class than low income housing, so that the people who lived there were "people like us" - as we students were aspiring doctors, lawyers, teachers, accountants etc. So the area gave rise to the internal reaction - "is this what the future holds for me?" which was a lot different looking than the vision that a lot of us had of our future lives. It definitely made you feel that "when you grew up" you wanted to live in a place that seemed a bit more special and had less sameness.

These days Daly City doesnt really look very different than a lot of places and most of us ended up living in some sort of "planned residential community" at some point after all so in retrospect the derision may have been unfair. However the song definitely resonated with us at the time in the sense of embodying our feeling that we wanted a different dream than ending up in a place with that much similarity - we wanted life to be special and to live in a special place. So to me the song was always about middle class sameness - similar in a way to Mellencamp's Pink Houses in terms of asking "is that all we get?". Perhaps derision that was heaped on Daly City did encourage developers to try thereafter to make affordable suburban housing a bit more varied looking