Shagtastic,
I think you'll find doing the FAA theory exams a lot easier than either the UK, JAR, NZ or Aus ATPL theory exams. I think that is what
VB are looking at. eg, Aussie sees loop hole in system. Instead of doing the Aus ATPL, goes to the US and does the FAA exams (flying?). They are then issued with an FAA ATPL. On the strength of that FAA ATPL they then hop back to Australia and do the conversion exam. A lot easier I believe.
A Brit with a JAR or UK ATPL I feel wouldn't be discriminated (in this way) by converting their lic to an Aus one.
I think what BIK 116.8 gets aggro about is the difference between what an Australian pilot has to go through to convert their ATPL versus what a foreign lic holder has to do to convert their lic to an Aus ATPL.
Having just converted my Aust ATPL to a JAR ATPL it isn't easy.