Yes, we saved quite a bit (about half) by going through a local rental company when we were in Australia in March and April. We used Meteor in Cairns and I can't remember who in Sydney. I did a Google search and got various quotes online.
Our American Express did not cover rentals in Australia, but our Visa did. Have your friend call her credit card company ahead of time to confirm coverage.
Edited because I had the name of the company wrong.
[This message has been edited by letiole (edited 06-17-2002).]