JMHO:
I don't think there is any question that any safety must be affordable safety - the only alternative is an outright ban. What I mean is, you can always make something "safer", by spending more or doing more. You have to draw a practical line somewhere.
We could have the passengers wearing crash helmets and fire-proof suits. That would have saved some lives over the years. We could be building aircraft components out of more expensive materials, and replacing them more often.
CASA needs to decide the rules, using safety as the most important consideration, but that doesn't mean "utmost safety", because that simply doesn't exist.
It needs to be acceptably safe (and in aviation that means a very low risk: no-where near the risks we accept in other areas of life, such as motor vehicles).
So of course CASA is invested in affordable safety, even if they don't use that phrase. If they weren't, they'd have to ban aviation in it's entirety.
But, Dick, using ETOPS (or EDTO as it now is, which also affects 4-engined aircraft) is probably not a good test case if you're mounting an argument to take up the tree. I'm sure you can find a better one.
As for CASA coming down to hard on GA etc, the problem is they keep crashing and killing themselves. The airlines aren't. So CASA have to be seen to be doing something about it. I think that problem actually goes further up the tree than CASA, it's the whole "nanny state" culture that Australia seems to have evolved into, from the top down. I don't know why, it just has. I wish I knew how to fix it.