I was a US government employee, civilian, living and working overseas for 2007. Do I pay taxes as a non-resident for CA (where I am registered) or file as a resident even though i was not physically there?

Most states tax expatriate U.S. citizens based on where they were last domiciled. I suspect you need to file as a resident of California under that general principle.

California has an exception to being treated as a resident if you are outside of California for at least 546 days under an employment contract and do not have significant investment income.