You are correct in this information. It would show "Not Ready". However after digging some more it looks like you can actually pass inspection with up to 2 sensors showing "Not Ready" if its older then 2000, and 1 sensor if its newer then 2000 I think it was. As long as the next year it gets inspected the same sensor isnt showing "Not Ready". Anyway ill leave it at that. I was just intrigued when I read this that a state could regulate the rental of regular auto repair tools. Once I found out it was the OBD tools it made a little more sense, especially with Cali's strict emissions rules. Still very dumb though.
Even in Texas however I do have some auto stores that wont let me touch there OBD scanners. They will do it for me but wont let me opperate it in fear that I will use it to clear the codes and not just read them. This is pretty lame in itself because almost any car can have the codes reset by just pulling the battery cable overnight. So its really more of a hassle then a preventive.