I had no issues popping the Optus $2/day 500mb plan into my portable hotspot and using it.

Amaysim is the way to go.
By far the best value for money - Most users will get by on $10 (1GB data, or voice + 500MB data), and for $20 you can score the Unlimited plan (4GB data + unlimited local voice)(The list price is $40 but there is almost always a 50% discount for the 1st month). Also (shameless plug warning), there is a 'refer-a-friend' promo that gets you a $10 credit.

Coverage is on Optus so unless you plan on going to the Outback you'll do fine.

Only downside is that it's not as easy to get, as say Telstra. If you know your upcoming Oz address, the easiest way is to get the SIM shipped there.

Almost all do, since they come with data limits on the plan.

Went to a Vodafone store. $30 got me 1GB of wireless data and unlimited texting and calls. For a 10 day trip, this was absolutely perfect. Explored every option known to man and this was by far the best. Just do it when you get there.

About a year later now. Does this still exist? Google/Optus site seem to think I want the $10 optus sim you can buy to use in other countries.

Looks like.

Thanks. So you pickup the SIM and pay as you go? Or when you pickup the SIM do you tell them you want X number of days? Or do you set that all up when you pop it in and activate it? Forgive my denseness, I've only done overseas SIM cards a couple of times and it's been a different process each time.

How are the LTE networks and are there prepaid products for those?

The Optus $2 a day 4G ready is a 3G/4G plan. The SIM can be obtained from any Optus store (bring your passport and use your hotel address, if needed) and if you add eg $20 credit, you get 10 days of usage in the next 20 days (if you don't use it, you won't be charged the $2.

At least in metro-Sydney it worked quite well, Optus LTE is faster than your average US 4G (well, Optus 3G is often faster than your average US 4G). We switched to the $2 a day 3G plan as it had unlimited data (4G has 500MB/day) and we weren't yet oriented to the data capped world. The network is a bit spotty but nowhere as bad as e.g. T-Mobile in the US.

Check out this thread.

Decided to try both Telstra and Optus (traveling with family). Optus was the $2/day, bought the SIM at a convenience store right outside immigration (there is also a kiosk by the car rental counters), and then topped up with $10. Plenty of data, and coverage good in Sydney and Melbourne. Not sure about other areas.

Telstra was more expensive: $15 for 1GB I think, but the activation process was MUCH more annoying. Website failed, had to call to complete, wasn't clear on the data only options.

Optus on the other hand, super easy to activate. I think if you're only in the cities, this is the best bet.

Going to be flying into SYD and I have an unlocked iPhone 6 - what's the best place in the airport to purchase a pre-paid nano SIM with data?

I've always had very good luck with Lebara. They have always been the least-expensive carrier with decent service and a st:)re in the arrivals area.

This thread has more info on the topic.

I am planning a 3 month trip across 6 countries (South Africa, Hong Kong, Singapore, Australia, New Zealand and Fiji). Longest stay will be 7 weeks in Australia. I am looking to buy a prepaid sim to use with my unlocked iphone 5 for data and maybe calls back to the US. Older threads indicate Telstra as the best. Is that still true? What recommendations?

Last year I bought a Vodafone SIM from their location in the arrivals hall at BNE. I only needed to show passport and nothing else. Even though my phone at the time (HTC One M7) was always on HSPA it was plenty fast enough. Vodafone reception did get sketchier in the mountains near the Sunshine Coast but that's only a minor ding considering I spent most of my time in the CBD and surrounding suburbs.

I forget what I paid exactly though but I do remember that it was the better option because the vast majority of my usage is data.