The state lays out traffic laws pretty clearly, but our county has some specific traffic needs (winter/snow issues). We're looking at having flasing green on recovery vehicles on route to their jobs.
Can a county make a regulation like that?
State law regulates the use of flashing and colored lights. Veh. Code 25250 says that "Flashing lights are prohibited on vehicles except as otherwise permitted", so if the state does not permit it, the county can't say anything about it. The list of permissions includes "making a turn", as a warning with parked on the side of the road, to warn of funeral procession, and nothing like what you describe.
The state does cover tow trucks in 25253:
(a) Tow trucks used to tow disabled vehicles shall be equipped with flashing amber warning lamps. This subdivision does not apply to a tractor-trailer combination.
(b) Tow trucks may display flashing amber warning lamps while providing service to a disabled vehicle. A flashing amber warning lamp upon a tow truck may be displayed to the rear when the tow truck is towing a vehicle and moving at a speed slower than the normal flow of traffic.
(c) A tow truck shall not display flashing amber warning lamps on a freeway except when an unusual traffic hazard or extreme hazard exists.
So first, the lights would have to be amber. Second, they can't be always flashing (it is allowed only when "actually towing"). Because state law forbids flashing lights except as specified, the described use is not specified, so it is forbidden.
There are really two independent issues here.
One is whether the county may enact traffic ordinances, which it almost certainly does, because then it can charge someone with a traffic violation on its own behalf without state involvement and collect the fines.
The second is whether a county may enact traffic ordinances that differ from the state traffic code, or whether that would be pre-empted by state law. A county almost certainly can't make a traffic law that contradicts state traffic law (e.g. in Alameda County people will drive on the left hand side of the road and red means go, while green means stop).
It may be possible to have ordinances that supplement state traffic laws and the ordinance you are describing in particular isn't necessarily even a true traffic law as opposed to a regulation of a particular kind of business similar to a law requiring taxis to be yellow.