What are their defensive requirements then? As far as I know Australia does not have any island territories not close the it's mainland. Would range really be a problem for Australia's defensive needs?
Yes.
Leaving to one side that Australia is in itself very large, we rely almost entirely on 3 lanes of approach for all our trade. Those lanes extend thousands of kilometres to the west, the north (which includes -- whisper it quietly because we are good friends and neighbours -- Indonesia) and the east.
To win a genuine shooting war, or merely to stalemate, we would need to be able to control those lanes. One critical element of controlling sea lanes is to control the air over those lanes. Since we don't have aircraft carriers, we need aircraft that can fly a long way, penetrate naval air defences and shoot at enemy planes and ships.
It also matters in case of a straight up land invasion. Australia's best defence in such a case is Australia. The sheer bulk of the landmass makes an invasion from any direction a long slow slog to occupy the rest of the country. Especially if that country possesses aircraft capable of very long flights from bases dispersed around the whole perimeter.
So in actual fact, aircraft range is worthy of consideration. Air tankers help, but while they multiply force, they also multiply vulnerability.
http://en.wikipedia.org/wiki/General_Dynamics_F-111C
Apparently the criterion for range was the ability to bomb Jakarta. Sounds arbitrary but I have no idea.
Any conflict they would be engaged in would also have a significant naval component, so range is valuable there as well -- it allows land-based planes to join battles far out at sea, so you can meet the enemy away from civilian population centers instead of right over them. The alternative is to use naval aviation (i.e. aircraft carriers) instead of land-based planes, but carriers are hugely expensive so the Royal Australian Navy (RAN) doesn't operate any.
No, range is more of an issue because Australia's current defensive posture is to try to stop any potential enemy in what is called the air-sea gap. That means interdiction at long distances off the coastline. With aircraft carriers being financially out of reach that leaves long range aircraft as the only viable option. The f-35 is going to be a disaster for Australia's defence, we can only hope that the US honours the goodwill that the purchase of those systems was supposed to procure. Of course, they're going to be flying the same crappy airframes, so meh.
Just one last thing in defence of the JSF though. It's unique capabilities in takeoff / landing make cheaper aircraft carriers a real possibility. Of course Australia hasn't actually tried to procure any such thing so it's only a theoretical, but if tensions were to start to mount in Asia that is something that could be rectified relatively quickly...