Hot off the press from the CASA 'Regulatory Guidance Centre':
Question: Does an aircraft being operate NVFR in G airspace at or below whichever is the higher of 3,000’ AMSL and 1,000’ AGL have to remain in VMC as defined in Part 91 MOS and comply with the corresponding operational requirement that: “Aircraft must be operated in sight of ground or water”?
If yes, does that mean that the pilot in command of an NVFR flight must, whenever operating at or below whichever is the higher of 3,000’ AMSA and 1,000’ AGL in G airspace, be able to physically see the ground or water?
Answer: An aircraft operating as a VFR flight (day or night) must comply with the VMC criteria referred to in regulation 91.280 of the Civil Aviation Safety Regulations 1998 (CASR) for the aircraft and airspace in which the flight is conducted. Division 2.4 of the Part 91 Manual of Standards (MOS) prescribes requirements relating to the operation of an aircraft for a VFR flight.
When operating below 1000ft AGL or 3000ft AMSL (whichever is higher), the aircraft must be operated in sight of ground or water, and the pilot must be able to physically see ground or water. This is illustrated in Table 2.07 (3) of the Part 91 MOS.
If something is in sight or within sight, you can see it. If it is out of sight, you can't see it. To apply this rule you must be able to actually see the ground or water.
The only time a NVFR flight would be operating lower than 3000ft AMSL or 1000ft AGL would be in accordance with subregulation 91.277(3) of CASR - taking off or landing or within the NVFR circling area of an aerodrome (within 3NM). At any other time, the aircraft must be at or above the NVFR LSALT in accordance with subregulation 91.277(2) - 1000 feet above the highest obstacle within 10NM of the aircraft. This height will always be above 1000ft AGL.
Further information is available in the Visual Flight Rules Guide on page 205 and may be applicable to your enquiry.
This guidance is current at the time it has been provided, however may be subject to change over time or at the discretion of the policy holder.
I wouldn't have used the word "illustrated", but their point is clear. And "this height" may always be above 1,000 AGL, but it won't necessarily always be above 3,000' AMSL.
Do with that what you will.