Oh sure, no one disagrees that transfers at e.g. MEL are much better, if you're going somewhere where that's feasible. But the fact is that thousands (?) of people manage fine with this transfer daily and it gets them where they want to go, at likely the best possible price. There's a network effect at SYD where more carriers fly there, because there are more domestic connections than anywhere else, driving more competition and better pricing. You have to assume that many people with separate tickets are price-sensitive (though I realise sometimes it's just that interlining doesn't exist).
Anyway, thanks all for the confirmation that transferring from a separate ticket is fine!
