You mentioned that anyone living in the same city as the airport should be able to go home. Not always possible. My car is in Alpha airport parking near Brisbane airport. They are not open 24 hours.
Taxi may not be $100 but it's probably $50-$60. Who cares? I don't want to pay. I refuse to use taxi to/from airport in BNE now I have a car.
It was after 9:00pm when we found out what VA were doing. Go back home in taxi and lug everything upstairs. Then lug everything back downstairs at 2:30am to make 6:00am flight comfortably.
Valid points and I thought I might chime in here, for what it is worth.
In my experience, and I think I fly quite a lot, the 2 major airlines, Qantas & Virgin Australia are much the same in what they offer for flight cancellations - ie they won't just hand out cash easily without some effort by passengers, and by law, they don't need to.
Jetstar - good luck getting anything.
I agree that you should not be out of pocket, to a point, with any airline, although there has to be a cap on this to avoid being abused (some will try).
Obviously missing your international flight from a delayed/cancelled domestic flight wouldn't be covered, they never are, unless you've booked both the domestic and international on a single booking.
I certainly wouldn't be booking the last flight out of an airport for the day, for an international flight first thing in the AM at the next airport (that's clearly a risk).
$200 is adequate for most travellers, perhaps in very special circumstances and with proof this could be higher, such as no hotel availability in the area for less than $350 for the night (if you do not live near the departure city), should be fully covered, along with your ride to and from the said hotel.
I feel, however, unless consumer laws are changed here for flight cancellations, the chance of any airline being more generous, is highly unlikely, for obvious reasons.
Airlines only appear generous in Europe as they have been forced by law, to offer much more in compensation.