Interesting stuff, certainly there was a push by some in the USAF to let Australia have the Raptor and not the seriously watered down version mentioned in the article. Despite the more noble reasons I've heard for them wanting to do so I have to wonder whether it wasn't at least in part a way to keep the production line open. Ultimately the USAF didn't think technology transfer was a particular problem got Australia at least but they didn't make the decision.
It's not so hard to imagine the ADF back then thinking about the savings the F-35 offered and looking at the f-35b as a path to getting the fleet air arm back but I don't think either is going to eventuate. I would have been very interested to know how much lobbying Lockheed did around this in the states and in Australia. Certainly they saw the f-35 as their comercial future even then and losing a country like Australia could have threatened sales to other countries that weren't even considering the Raptor. They may well have been lobbying against their own aircraft.
I remember when they were repeating and repeating that Australia was not committed to buy the JSF, we'd only bought into the development of the program like we had options after not pursuing the f-22, more super bugs? French or Swedish fighters? Su-35? What a silly thing to say. Having said that I think australia should think about buying typhoons (though not exclusively) but that's obviously never ever going to happen.
Last thing I'll say is that I'd very much like to find out more about the initial contact and agreement between prime minister John Howard and LM during his 2001 trip to the US that put this all in motion, if anyone has good info or sources I'd be very interested.