Lye is a really strong base, but not a very poisonous substance at all. Once it's nuetralized, it's pretty much gone. You neutralize it with acid. VERY CAREFULLY! It'll get hot just like when you mix it. Acids that are cheap are white vinegar and muriatic acid (Hydrochloric acid), which you can get at hardware stores. You'll need a couple gallons of vinegar, I guess, but one bottle of muriatic acid will probably do the trick. It's a very vigorous reaction, and you could actually make it boil if you go too fast. I'd do it in small portions and add the acid to the lye (dilute the muriatic 3:1 or so if it's concentrated, once again, add the acid to the water not vica versa). There are no poisonous gases to worry about
You'll also need an idea of when the lye is neutralized. You can find pH indicator strips on the web, but you can also make a cheap and fun indicator with red cabbage:
http://chemistry.about.com/library/weekly/aa012803a.htmThis is not safe to do unless you make it safe! Try a small batch first to get to know what you're in for and wear protection - especially eye protection - a full face shield is a really good idea. I'd also advise you to have a batch of ice around in case it starts to get too hot. Do it outdside if you can since a little spill on the ground will not cause permanent harm.
Once it's neutralized, it's only salt water (if you use muriatic acid) so it should be safe to put down the drain. It becomes sodium acetate with vinegar and I'm not sure if this affects septic systems, but I doubt it, it might even be beneficial to the bacteria. It's not poisonous. You could pour it out in the dirt, but the salt concentration could kill grass or plants.
Scott, I'll say a prayer for you and your fellow So Cal's. I lived near San Bernadino and I've seen what the Santa Ana wind can do. Be safe!