Second that!
Georgo and Joker, I'll second that!
Don't let anything deter you from working hard and aimming high. If you want it hard enough, you'll work hard enough for it, and regardless of intakes - you'll be putting forward a strong case for appointment.
Unless you are told by a qualified source, as in someone who works in Canberra at Defence, I would take what you hear on number of intakes as sheer rumour. Those numbers are secret business, repeat secret. Yes the intakes are low this year, and possibly will continue to be in the future, but that is about it. Unfortunately CJ0203, what you hear at FSP comes from trainee pilots in a place rife with rumour - see beginning of paragraph.
One thing everyone seems to have neglected is that the 2010 FSP schedule is up on the RAAF website. The number of spots is the same in 2010, but with an additional 18 spots for Observer applicants. The number of DE spots is down in 2010 (159) from 2009 (177), and the number of ADFA spots is up in 2010 (117) from 2009 (99). It may not sound like a lot, but that is a pretty big shift towards ADFA, at least in the recruiting stage. How these numbers carry through in terms of intakes, it's anybodies guess??????
Fail rate varies from course to course, but over the long-term, about 50% is a fair call. The learning curve is very steep, over a long period of time. Limited resources require this to be the case in order to maximise productivity.
Again, don't let numbers deter you - the good get through no matter what. Pilots course is definitely passable - many people have been through it and many will in the future. Many have failed ADF pilots course and gone onto be civilian pilots who have done well. Failing ADF pilots course does not mean you cannot be a pilot, it just says you do not meet those very high standards required by the military that are not so much in civilian aviation.