Yes, prior to 1971 it represented the branch that assigned the number however the card had to be applied for at the social security office from which it was issued. Seeing as Obama ( according to his autobiography) did not step foot on the mainland for the first time until 1972, applying form the Conn office would have been impossible.
From the Social Security site:
Prior to 1972, cards were issued in local Social Security offices around the country and the Area Number represented the State in which the card was issued. This did not necessarily have to be the State where the applicant lived, since a person could apply for their card in any Social Security office.
That means they had to apply for the card in the office from which it was issued.
That number was issued between1977 and 1979, according to the PI who started this whole tempest in a teapot:
From the affidavit of Susan Daniels, licensed private investigator, Document No. 78-5, filed in Barnett, et al v. Obama, US District Court for the Central District of California, Santa Ana (Southern) Divison on 10/01/2009.
"I located a social security number for Barack Hussein Obama and found that it was issued between 1977-1979 in the State of Connecticut."
From the SSA link at comment 43:
Since 1972, when SSA began assigning SSNs and issuing cards centrally from Baltimore, the area number assigned has been based on the ZIP code in the mailing address provided on the application for the original Social Security card. The applicant's mailing address does not have to be the same as their place of residence. Thus, the Area Number does not necessarily represent the State of residence of the applicant, either prior to 1972 or since.
I would also challenge any private detective to testify under oath that Obama never visited Connecticut betwen 1977 and 1979. How could they possibly prove it?
The fact that he had a verified SSN issued in CT is odd, nothing more.