Seems to me that Wikipedia/Wikibooks already fulfils the prerequisites.
I predict the Californian project will fail because the bureaucrats in charge will insist on a top-down, planned model for creating the textbooks. Open-source is so successful and dynamic because it is an emergent phenomena. For every open-source project that succeeds I bet there are a hundred that fail and there is no way to foresee which will be successful.
That said, if the governator accepts that intellectual monopoly is not necessary to incentivise people to gather and summarise dispersed human knowledge into a form children can learn from, he could push for the elimination of copyright on children's textbooks (or advocate that copyright is granted only when it is proven necessary) and allow the free market to generate the outcomes he desires.
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