I would think in the long run Davis would be the better choice. Pepperdine is a beautiful school and if you do in fact keep the scholarship it would be the better choice, but since they have a requirement that you been in the top 3rd of the class there is only a 33% chance you will keep the scholarship and then you will be living in Malibu, which is a very expensive area.
Davis at least the money is guaranteed and having lived around there I know housing and living is CHEAP!!!! Particularly compared to Malibu one of the most expensive places in America. If you want to live in Portland Davis is probably better just on location standpoint although not much more beneficial. People in Oregon and Northern California tend to have a biased against people from L.A., which is weird but the way it is. Obviously it does not apply to most people, but people Northern California/Oregon do honestly have some negative biased towards L.A and Southern California.
One could say that Davis is in the middle of nowhere which it is and will limit your internship opportunities during school and that is true. However, Malibu although somewhat in L.A. is really far from Downtown and there would be as many internships in the Malibu area as there would in Davis. Malibu is nothing more than a beach town and any real substantive internship would be in downtown L.A.. Getting to downtown L.A. firms would be a hell of a drive and you would have to deal with insane traffic to get to downtown. San Fernando Valley is a little closer and there are opportunities in Ventura/Thousand Oaks, which are somewhat closer to Pepperdine, but still it is a drive and neither of those areas offer that much opportunity. If you were in Davis it would be an easier commute from Davis to Sacramento than it would be from Malibu to downtown L.A. Sacramento has a lot opportunities since it is the capital of California.
The interests outside of law school would be a problem in Davis. Davis does not have that many exciting things to offer it is a true college town. You can play guitar and skate, but obviously not much of a market for that in Davis. However, if you are in law school it will be hard to keep those extracurricular activities up extensively if you want to do well. I was a basketball player before I got myself into this mess of law school, but now I play maybe once a week.
So I would probably choose Davis if I were in your situation. It is a tough choice though.
I know lawyers that went to both schools who are pretty cool who might give you some insight. If you want their e-mails you can personal message me.