I fail to understand why this dispute escalated to the point of threatened legal action, or why CASA's integrity is in any way involved.
First of all, I am assuming we are talking about CTAF (R) airfields. If you aren't then as far as I know straight in approaches are illegal.
I also have personal experience (last week) of what it's like "arranging separation" with an oncoming aircraft on a straight in approach. Five miles is about 6 minutes at 80 knots.
In my case I was downwind for 35L at YMMB. Two Warriors called at Carrum inbound (5.4 miles) about a minute apart. I was ready to turn base at 3 miles (the Golf Course) when the always helpful Tower kindly queried if I thought I could fit between the two of them (they were by this time at 3 miles and a bit over four miles). I replied negative, widened out a bit and brought up the rear. Tower changed the landing order. No dramas.
This whole exercise, by my timing, took about four minutes from realising that there was someone doing a straight in approach, spotting the other aircraft, and analysing who was going to have to fit where to ensure separation. I fail to understand the point of reducing the time available to achieve this by reducing the five mile minima. I wonder how well the two of us would have done without a helpful tower?
It will be interesting reading the safety case since if you reduced it to three miles, which is round about the longitudinal distance from the threshold you are on base in a Piper or Cessna, you could conceivably announce your intentions just as an aircraft turning final arrived exactly where you are at 90 degrees to your course.
Anyway why bother? Just to save two minutes time?