First, the press release specifically says "revised his estimate of the number of animals killed in bushfires in NSW to more than 800 million animals, with a national impact of more than one billion animals. " [1]
You say: "Third, for almost all species, there are no density figures, so he just picked the number 10 (lol, yes, seriously)"
When looking at the original report, linked in full text below [0] it reads:
> Many species were excluded from estimates because there is insufficient information on their abundance. The largest omission is the entire NSW bat fauna (37 species), for which no information on density could be found.
Regarding the birds, there is section 3.4 of the original report where the authors elaborate their stand. For instance, the loss of woodland (in this study the conversion to grassland) drastically reduces the number of birds in that area "90-95% fewer than in intact woodland". Given the size of the current fires it is a stretch to assume that 99% of birds are able to move to other forest and into other birds' habitats and be able to survive their alongside whatever lives there already.
[0] - 2007 report by Dickman et al, https://www.researchgate.net/publication/318029981_Impacts_o...
[1] - press release: https://sydney.edu.au/news-opinion/news/2020/01/08/australia...