The choice is Arnold or Angelides, "neither" defaults to Angelides.
Any conservative, Republican, moderate who doesn't ACTIVELY VOTE FOR Arnold, is voting FOR ANGELIDES.
Angelides is actually counting on that.
The "neither" was in response to him being either socially or fiscally conservative.
As for your comment, it's the basic "our guy sucks less" that has become the GOP default position. I've heard it before. Arnold is indeed the better liberal Democrat of the two.