I'm in the SF Bay also. Six or seven months ago, my girlfriend and I bought a 1972 Ericson 27 for $4000. It had some problems, but nothing that serious or not easy to fix. It had no motor, so we paid an additional $2000 to fix that with a new outboard; we also immediately paid about $1000 for a bottom job. It came decently outfitted, but most of the stuff was pretty old, so we've been buying a lot of new stuff. I haven't yet done any repair work on it more serious than replacing light bulbs, but we've been on more than a dozen sails and are generally pleased so far.
My general impression is that the SF Bay has a huge market, and you can buy local boats at pretty much any price you want, with what we paid being close to the bottom end of it. The more picky you are, the more price goes up. The more you're willing to wait or be flexable, the more the price goes down. Regardless, you should never buy a boat that has serious problems, particularly one that would prevent actually sailing it, because it's just not worth it; there will be perfectly good non-broken boats at that price.
I'm not very experienced on the side of selling boats, but I have some thoughts that might be useful. Restoration work can increase a boat's selling price, only to a certain point, and not necessarily in an economical way. No matter how substantially a boat has been upgraded, it will be very difficult to sell past the normal high end for a boat of its type. Additionally, for most normal upgrades, each dollar of upgrade will be worth less than a dollar of additional sale price. The other factor is maintenance; a lot of expensive, time-consuming operations, such as painting, varnishing, etc., aren't really upgrades at all, but just regular maintenance, or compensating for deferred maintenance. These activities won't raise boat value much at all.
Since you're a professional in the bay area, it's most probable that all boating activities will have more opportunity cost (foregone income) than you could possibly get in fixer-upper income, given your decent pay rate. So my general advice is that you should consider general boating stuff as more of an expense than an investment. I think a buy-low-sell-high fix-and-flip business plan is possible, but the yields would probably be seriously unimpressive, compared to doing a 9-to-5 whitecollar.
One factor to consider is that the SF Bay has a very strong racing community. If you want to get involved in that, you should factor that in to your search.
In general, though, the way to get started is to look at what's out there. Sources that were good for me were, in approximate order of usefulness: Craigslist, Latitude 38 Classy Classifieds, Yacht World, sailboatlistings.com, Sailing Texas Classifieds, bulletin board outside marinas, Ebay. Start looking at that, then visit a few marinas around the bay, particularly the ones that are closest and are most likely to be your marina. See what sort of boats they have, and talk to anyone you can find there. A lot of people have suggested yacht clubs or sailing clubs, but it's not something I've personally gotten into yet.
I hope this helps. Good luck!