Legal Question in Personal Injury in California

They have an eye witness you were in the accident: the other driver.

They can't suspend your license, only the Department of Motor Vehicles can. They can report you to DMV or file an SR1 form with the DMV. It doesn't matter who was at fault for the accident. If you deny you were in the accident, you would have to prove this to the DMV.

You were required to file a form SR-1 with the DMV, and they would have then suspended your license for being uninsured. Or they will suspend your license for not filing the SR-1.

They should not be threatening you. Whether you have a license and/or insurance has nothing to do with who was at fault or the injuries. They would be correct in telling you that because you are uninusred you can not collect any pain and suffering but not in making any threats. If they keep it up, report the adjuster to his supervisor and if that does not work make a complaint with the Insurance Commissioner. But also accept your legal responsibility if you had a degree of fault for the accident.