Aussie submarines might not carry nuclear weapons but the do carry torpedos which sink ships, just ask the Argentinians about their cruiser General Belgrano.
A multitude of submarines from various western countries patrolling in the South China Sea would make the Chinese think very carefully before getting too aggressive. At the very least it would require significant resources to be directed towards anti submarine warfare, and this is an area in which they are well behind.
China is vulnerable to a costal blockade as all of its sea ports are located on the eastern side in a relatively small area of its total border, unlike the USA which has ports thousands of miles apart serving different oceans. With Japan, Taiwan, South Korea and the Philippines nearby, and most Chinese shipping having to pass through choke points on the way in and out, being cut off is a real possibility.
They of course know this, the Belt and Road initiative aims for alternative transport arrangements using ports in other countries connecting into the rail network.