They're more about cutting wind resistance and wicking away your sweat so when you arrive at your destination, you're not feeling as damp and nasty as you would if you were, say, wearing a cotton shirt. In your hilly San Francisco environment, you'd only benefit from the reduced wind resistance on descents - not so much on climbing as even pro cyclists cannot go fast enough on a climb to benefit. BTW, my Pearl Izumi cycling jacket hardly exposes anything.

The problem with pants is the pants leg might get caught in your pedals - that is why cyclists wear shorts or put reflective leg wrappers like this one around the pants leg: CycleAware Moto Slap & Wrap Reflective Pant Leg Bands - Boys' - Package of 2 - 2014 Overstock - REI.com

As a beginning cyclist, I've fallen maybe 10 times from my bike because I messed up a turn on gravel/sand or made some other bad decision; but have only suffered cuts/bruises on two of those falls. That's because most of the time, I landed on my feet and the bike hit the ground on its side. The bruises were from hitting a wall or some other object rather than the ground itself. If you're worried about falling, just try to think of landing feet-first when you feel the bike start to tip over.