It looks like lane filtering (not splitting through moving traffic) IS in fact legal in NSW when done properly. Motorbikes are allowed to pass stationary traffic on the right of said vehicles; this is the same as passing a parked car in a street with no lines.
You must stay within the line, pass on the right and only do so when traffic is stationary.
Just don't give the cranky cops stuck in traffic some other reason to book you, like having an illegal fender eliminator or something
