The Federal Government can decide who can cross the border into Australia and the conditions under which they do so. Sure the Feds could impose a quarantine requirement but then they would have to administer and deliver it. That is something they have shown no inclination to take on since March 2020.
NSW is getting out of the quarantine game for vaccinated arrivals from 01 November. Who is going to take over?
The moment an international traveller steps foot outside a terminal they will be free to do as they wish inside NSW.
The real question is how long the other states/territories will be able to justify their own quarantine requirements from now on.