I'm not familiar with the details of CA law, but I'm gently surprised that that would be a problem for that event, unless the identifying data for the tap/scan included some kind of personal information (ie, their name). I could definitely understand it - I know CA is really, really strict (frequently, in good ways). But I'd wonder what data would be collected/exchanged in that transaction.
(Hypothetically - if that were like a convention, and they were using the bracelet to provide information to/from the individual exhibitors at the event, I could definitely see that being an issue, since it would potentially be exchanging personal information between the attendee and the exhibitor.)
At face value, it doesn't feel like using a MagicBand would be much different than using an RFID card to get into a hotel room.
Most RFID cards, for example, don't carry any personal data on them. They just have the identifying mark of the card.
So, for example, in a hypothetical MagicBand situation - as you ride past the scanner, it would see your MagicBand, see that its ID is 8675309, and add picture123987456.jpg to the account connected to that ID. In theory, even if the picture itself is arguably an identifying object, there's no exchange of personal data. The MagicBand doesn't know who you are, and neither does the scanner - the system does that work in a closed one-party environment using data you've already provided. (And, honestly, the scanners at WDW frequently get it wrong - it occasionally asks you to pick from two or three photos to determine which one you want.)
But, honestly, I couldn't rule it out.
It's funny - when I saw your response, I initially thought you were responding to the fingerprint scan response above. That would definitely be more of an issue, and might also explain why DLR hasn't implemented the "fingerprint" scanners. When WDW implemented the biometric scan in the 90s, it was controversial, moreso when they switched to the "fingerprint" scanner. (For anyone wondering why I'm putting fingerprint in quotation marks - WDW is insistent that they don't actually collect fingerprints - they insist they're using biometric data from the finger as an identifying mark.) And biometric data (and especially a fingerprint) would almost certainly count as identifying data at a higher privacy level than a photograph.