Here's another view.

http://www.kefir.net/spray/buzzwormairspray.htm

Maybe the second-hand tale was a little exagerrated and maybe the passenger wasn't talking about a flight to Australia, but the spraying happens. I flew between LHR and DEL last year and was doused in both directions. As the OP mentioned, no chance to escape. Why they felt it necessary to de-bug a flight that left LHR in late February I'll never know. The FAs said that WHO "ordered" it, which is a lie. WHO says it's OK but it's a government decision. I know I looked like a hypochondriac but I hid under my blanket when the FAs came through. They were NOT masked and I felt sorrier for them. One former FA has a site on this, but I can't find it right now. I do remember one case of the spraying being fatal to someoen with asthma.

Later I asked my son, who flew to Australia in 2000, if they'd been sprayed and he said no- but there are also techniques to treat the aircraft when no one is aboard which can be just as nasty- sometimes the seats are still wet when the pax get into the plane.