The most logical way to grade-separate the line would be on an elevated structure, such as similar lines in Japan. NIMBYs scream that this would destroy their cities, and that "they" (defined as "not me!") should tunnel the line to keep it from having the slightest disruption in their nice cozy little neighborhoods, which they like to pretend aren't part of a large urban area. (Anyone who has every tried to walk through Atherton knows about this self-imposed isolation.)
I'm reminded that when BART was being built, it was originally going to go through Berkeley on an elevated structure. The people of Berkeley were outraged. But the voters there actually took responsibility for themselves; they voted to tax themselves an additional amount to pay for the difference between the less-expensive elevated structure and the much-more-expensive subway. Thus BART's Berkeley stations are underground.
These NIMBYs who want to pretend the trains don't exist should vote a property tax upon themselves to fund the huge additional expense (on top of an already incredibly expensive project) of digging a 50-mile-long subway tunnel along the Peninsula. I would respect them much more if they were willing to put their money where their whiny mouths were. As it stands now, I think they're a bunch of little children who think they're living in the country but want to continue to enjoy the benefits of living in a big city. Oh, and I also suspect an underlying subtext: I'm rich and important, so go take your nasty noisy trains and go tear down homes where Poor People live.
Lest anyone think I'm saying that because I'm safely away from the lines myself, I'll add that I campaigned for the route to go close to where I live, via Altamont Pass, Niles Canyon, and Centerville. I think the decision to route the line through Pacheco Pass is a mistake for which people 50 years from now will be cursing the politicians of today. But I'd rather we get a working HSR line built than to destroy it just because I didn't get my own preferred routes.
By the way, there are also people who seem incredibly short-sighted about why high-speed rail lines work. They say things like, "Why build it to San Francisco? Just have everyone get off in San Jose and take Caltrain," or "Stop at SFO; the only reason anyone would take it is if they were going to/from the airport anyway." The whole point of high speed trains is that they allow you to go from city center to city center without time-consuming transfers. Add hours of delay and annoyance with transfers and their entire advantage disappears. Anyone who has used actual working high-speed trains in first world countries (as opposed to the backwater that is the USA) knows this.