Veteran's Park is located relatively central in Monterey. Everyone will know where it is if you ask around. They have Bike and Hike access for $6.00 a night per person, hot showers, bathrooms, and electricity hookups. If you arrive late at night you may get away with walking out unnoticed, but the ranger is an observant guy. He won't sweat you too hard as long as it's only a couple nights.
Meet fellow travellers on hospitality exchange networks: States Trustroots
Places to avoid
Fisherman's Wharf has alot of undercover police. Downtown Monterey is exorbitantly priced. There are many homeless in Monterey who hang out in the central bus stop and fisherman's wharf areas.