Having travelled across the country regularly for work for the last 12 years, almost evenly split between QF & VA (pre-Bain), IMHO Virgin has a significantly better experience from a passenger's point of view. Cleaner lounges, cleaner aircraft, happier cabin crew, a nicer Business product, their own security lane going direct into the lounge, the only thing I didn't like was their lounges did not serve spirits (and really, if that's as bad as it gets, it's a pretty sad day!)
QF seems to be stuck in a 1980's time warp where they think "We are the best, we're #1" and they have no incentive to change, so they won't. They know they've got the Government contracts, they know if a corporation needs to fly their executives they'll choose them, so why bother doing anything different? But from a passengers view the Qantas Club is dated, you will get chastised if you dare to try to speak to a customer service agent upon checkin instead of using one of their machines, (because you know, you might have a query about your connection??) and a lot, but by no means all, of the cabin crew seem to be just 'going through the motions'. I fully understand their first job is safety, but when you are the de-facto face of the airline you need to act like it.
To me it now seems the only difference between a full service and LCC in Oz now is whether you have to pay for a hot meal on board - and let's face it, calling it a "meal" is a stretch. I don't think I've had anything except the cheese, crackers and a bottle of water on board - by choice mind you - in the last 5 years! Everything else is much the same for economy travellers - even QF now charge you to sit in the exit row whereas that was previously free.