I couldn't help but notice the dept name in the ./ newsletter - lovely people, shame about the government. I think this pretty much sums up my sentiments about Australia.
In any case, we have exactly the same problem in Germany. We do indeed have an 18 rating for games here (there's 0, 6, 12, 18). The problem is that a hell of a lot of games that would have received an MA 15+ in Australia usually get an 18 in Germany or are completely refused classification. If they're refused classification, there's a good chance the title will be "indexed" - placed on a list of media that the government considers to be harmful to young people. I think there's only been one occasion in the past five years where classification was refused but the game was not placed on the index - Clive Barker's Jericho. After that, the USK relented and gave it an 18 rating. Games that have been placed on the index include Carmageddon, El Matador, Shellshock, Dark Forces, Little Britain, Quake 1-4 etc. Castrated versions of these games are sometimes released.
The problem is as follows - in my experience, the decision to place a game on the index in Germany makes it a hot property. If USK classification is refused, there is a rush to buy the game before it is indexed, regardless of the quality. It makes for a highly desirable property and increases the popularity of a title in Germany. A lot of teenagers, too, seek out games on the basis of their "cool" factor - usually on the basis that the game is indexed. I know at the very least of 20-30 kids here in my neighbourhood here that do this. I've seen kids with Call of Duty 5 uncut (which I already have original TYVM), Manhunt 2, Dead RIsing and more. I caught a 10-year-old playing Dead Rising on his 360 a while back and I asked my friend (his old man) what he was doing playing it. He had no idea, but it didn't happen again. I still don't know where he got it from, but we only have one games store around here that deals in indexed games.
Fact is, banning a title doesn't prevent it getting into the hands of children - on the contrary, it makes the game more desirable to children and increases its popularity. On the PC, it causes the titles to be pirated more frequently, so the games are more widespread but the publisher loses money. I suspect the situation is the same in Australia - a game refused classification is more than likely a hot property for kids.