Anything can happen anywhere, to be honest if the tail was infringing the runway strip and the Jabiru elected to do a touch and go there is 99.9% chance that it will occur without contact between aircraft, because the Jabiru pilot maintained visual separation with the Jet while doing it. Would it be legal? hell no, and then there would be all sorts of rigmarole and media coverage about 200 people almost incinerated by a rogue RAA aircraft. I remember in a GAAP years a solo student told "aircraft on the runway, go-around", the student flew around the aircraft holding on the threshold and landed safely (class D would not have changed the outcome), then there's the myriad of aircraft that have taken off and landed on runway center at Moorabbin well past it being closed. I've had to go round at Moorabbin at 20 feet in a chieftain because a Cessna taxied straight out onto the runway at speed mid field thinking it was a taxiway. Laws and regulations don't stop anything from happening, they just allow prosecution and consequence for not doing it. Having a yell at someone that's been told a few times already is just consuming radio space and really doesn't achieve more than just putting your own aircraft in a safer position.
As for Class E vs G, they are en-route airspace rules, they have not much to do with what happens in a CTAF, where if busy the IFR aircraft will in most cases turn down center to concentrate on local traffic. As the Mangalore reports suggests listening to two busy frequencies is really not going to work. Once an RPT is about 10-15 Nm from a busy CTAF they most likely will not hear or respond to ATS calls as they will be busy focusing on separation.
Now lets get real for a moment, hundreds of RPT flights operate in class G daily. Most airprox events occur in controlled airspace or close to a CTAF. RPT with TCAS must report RAs so there would be a good database of conflicts OCTA as well. Extending class E will not prevent these conflicts. Going back to Ballina, how would class E have stopped the 208 taking off reciprocal to the VA 737 on final, then it climbed out and failed to maintain 2000 when asked and conflicted with an A320 as well.
How can you fix these problems?
The real fix is onboard backup that can sense collisions and warn the pilot and come up with a resolution, TCAS, or ADS-B In. Problem, it costs a lot and some GA will resist it on cost base.
Airspace fixes, en-route, yes class E possibly has it's place, but to be honest it really doesn't fix the rogue aircraft issue, not even class C stops someone stupid from just busting in and flying straight through final for a major runway at a capital city airport, transponder or not. At least with transponder ATS has more chance of spotting and following the intruder in a timely manner and aircraft proximity systems have more chance to do their thing.
Class C/D towers would fix a lot of the runway conflicts, but there will still be some. Runway incursions still happen at major controlled airports as well.