Thanks for the info guys.
I get the feeling that the California DMV just has no clue on how to handle these bikes.
Not that they have a clue on anything, but we have always known that.
So basically take any route needed to get it done.
Take it to a DMV in an area where they have experiance with these bikes. If you take it to somewhere like San Francisco and the nice lady helping you has never actually seen a real live dirt road, Then its a good chance she has no clue how to register a trials bike with a foreign VIN and has even less desire to learn how to.
The best thing to do in this situation is to go in prepared, act like you do this all the time and basically tell them how to do it. If you seem knowledgeable about the subject sometimes they will just take your word for it rather than having to deal with the supervisor. Of course being polite is always a huge help.
I read that the DMV/ CHP offices in Temecula, CA is a good spot. Supposed to be a very cool CHP officer that goes the extra mile for OHV riders.
But Temecula is a bit to far away for me to go and register the bike. 6 hour drive.
Another route would be to register it as a Special Construction OHV. This may play out well as the VIN is foreign and DMV may have a hard time deciphering it. You can also play the "Its a Yamaha engine on a non-Yamaha frame" card.