Yeah, that shit definitely started in norcal, but its spread all over the west coast now. People definitely dont say it as much outside of nor-cal, but you definitely hear it, especially if you know folks from the bay, or spend time down there and whatnot.
Like dude said, its pretty much a linguistic improvement -- you sound like a straight dork if you say 'lots' or 'tons' or 'a lot' all the time. It's nice to sprinkle in a 'hella' here and there.
Y'all is some slang that pretty necessary too. Because if you just say 'you' meaning y'all, its confusing -- do you mean just the person you are talking to, or everyone? And 'you all' just sounds dumb as well as gramatically busted.