It's a little more complicated than that. When it comes to produce, I think you are right being able to grow year round is a huge advantage. But, many of the nuts and stone fruit grown in California would actually do better if were cooler (better fruit set, fewer pests). What is very compelling about California agriculture is the dry, low humidity summers that prevent crop damage and at least in the central valley, quite possibly the best agricultural soil on the planet. Of course the federal and state water projects also help a lot by increasing access to water and historically have been a huge indirect government subsidy to CA agriculture.
> If you're growing inside, then you might as well grow where the water/people are.
California has a population approaching 40 million.
I think the Salinas Valley in California is even a stronger contender for this title than the Central Valley.
Well, no, you want to, ideally, grow where the water is but the people aren't. Because otherwise agricultural use and human use are competing for space in the same high-demand areas, and driving the prices up for each other. It may be even be worth moving some water to where the people aren't to support growing to permit this, given the normal tendency for people to also be where the water is.