I'm late to the party and I'm sure OP has already made her decision. I agree that it's silly to turn down a funded PhD offer for a Masters, which comes with no guarantees and will cost you money.
But here is a third option to consider, since it sounds as though you are just out of undergrad, the most likely reason is lack of research experience and/or connections with the right faculty to recommend your application. In which case, you could check with UCLA whether they would allow you to defer your offer for a year, on the basis of wanting to get more research experience. You could then apply to be a full time RA for the Harvard professor you mentioned. You could reapply to PhD programs next year and if you don't get in you still have the UCLA offer. Just a suggestion.
