Yes, rents are part of the price of the ticket to work in SV, and as such does not constitute discretionary income. The extra cash you spend to drive a BMW instead of a five year old Nissan definitely most certainly does.
You can easily find a room in an apartment for less than 1000 $/mo anywhere in the bay. It won't be a nice room if you choose to live in, say SoMa, but it's housing. So you could argue anything over that is "discretionary".
Obviously, many people would consider such a living situation unacceptable. But in the most general sense, it is still a choice.
None of this means that there aren't valid reasons for staying here; even giving up a fairly significant portion of my income as rent leaves me with more money than I'd likely have after rent if I had a comparable job in Tampa, assuming I could even find one. But I don't think this is a sustainable situation for the region. The nanny in the "This is your life in SV" satire, and other people in her salary range (or under it), are on the cusp of being pushed out of the area entirely.