Not logical
The pilot clearly negotiated the high headlands and resultant turbulence of Port Stephens without a problem. Anna bay is the start of the beach with lower terrain along The Stockton Bight
Holding at that location normally has to be over water making a left hand turn to start,
Good horizon ahead when going south because the Newcastle City lights.
Zero lights and horizon when turning out to sea!
Is this what killed them? 1930s ATC procedures and a refusal to follow the CASA instructions to put in Class D airspace?