Condensation,
I too suffer from hearing loss but have still been able to get a class 1 medical.
From what I have been told, there are four levels to which they can test your hearing.
Stage 1: Standard hearing test at the DAME. If you pass, then OK. If you fail, go to Stage 2.
Stage 2: Standard hearing test at a hearing specialist ('Australian Hearing Centre' from where I recall). If you pass, then OK. If you fail, go to Stage 3.
Stage 3: Voice recognition test at the hearing specialist. If you pass, then OK. If you fail, go to Stage 4.
Stage 4: Voice recognition test in a simulated cockpit environment. If you pass, then OK. If you fail, well, then you are in trouble (quote "we've tried to get you through the hearing test, but there is only so much we can do").
I passed stage 3, so, I got through all is ok. All I can suggest is to go for the test, who knows? you may get through on Stage 1. There is no harm in trying. No point worrying until the professionals tell you that your hearing is not good enough. Also, follow the advice of the others, ie. avoid loud noise prior to the test, get a good sleep etc.
Good Luck!!