I'm not from Australia, but I got a Google account with a credit card before getting an iTunes account, even though I owned an iPod for years before getting an Android. It's true nonetheless that iTunes has more people hooked up because of iPods, but it's only a temporary problem and I don't really think there are many young people with a credit card anyway.

On the technical nature of Android developers and free equivalents, personally I tend to get paid apps.

For instance I bought "Extreme Call Blocker", because blocking calls and SMS messages is difficult as Android's APIs for it are private and I couldn't find a free app that worked well. I also got "GreenPower Premium" for saving battery, because such an app saves you money (I needed more battery life and the alternative would have been to replace my phone). I also bought "Paper Camera" because it's a fun app and cheaper than one coffee.

In truth there aren't many free apps that are worthwhile, most of the useful ones being clients of online services.