Yes, it's true that pine dust can cause cancer and is considered a class 1 carcinogen (see
https://www.ccohs.ca/oshanswers/chemicals/wood_dust.html but so are a lot of other things in our environment and diets.
For example, alcoholic beverages, birth control pills, and processed meat are also all class 1 carcinogens, yet we generally consume/use those with relative abandon. (see
https://www.cancer.org/cancer/cancer-causes/general-info/known-and-probable-human-carcinogens.html)
At the end, of the day, the balance between what is reasonable and what you can afford might be to use the pine litter and buy masks from the drug store. Unless you're bathing in it, it's a relatively small amount you're inhaling over a relatively short period of time. The problems with wood dust tends to be related to people who have a lot of exposure over long periods, such as wood pulp workers and carpenters.
As for the health of the cat, the data on the effects to the cat may not even exist. Besides which, the life span of the average cat likely isn't long enough for the problems to manifest during their lifetime. I can see the benefits of the pine in that it's renewable and more sustainable than clay or some of the other materials alternative litters are made out of.
Also, don't put too much weight on the California warnings. This is the same state that will douse furniture and children's sleepwear in carcinogens (i.e. fire retardants) on the off chance they get caught on fire.