I used this new transfer facility last week for the first time and thought it was hopeless.
In fairness - the last time I entered SYD internationally for a DOM transfer was 2 years ago and can't really remember the old procedure - but I seem to recall that all you had to do was exit the customs hall and there was a baggage re-check facility right there (so that you didn't have to cart your bags 3 miles).
SO - what was wrong with the new facility:
1/ Having to cart your bags 3 miles to re-check them after exiting customs (OK - a slight exaggeration - but the distance is extreme for a "world-class airport" such as SYD. I mean COME ON - even LAX does better than this (and no-one is about to start defending LAX).
It clearly has been a while since you used it. I first used it about 8 years ago and even back then it wasn't as you described. Coming off a Qantas international flight you had to walk out the customs hall, turn right, turn right again, go past the train station entry then down a hallway. All of about max 200m. From the side used by Star/Emirates etc add maybe another 100m.
I am yet to use this new facility, but from what has been described it is new building/extension in the same basic vicinity as the old with the entrance near the train station entrance, so if anything it is a little closer than the old one.
Do agree with your other points though, they don't seem too adept at adjusting to varying levels of use, nor generally aiding in prioritising transfers when it is busy.