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pokemon regions are supposed to be regions not countries so pulling something like kalos, galar and to some degree alola is out of the question
So what part of australia then? the obvious answer would be the high population area in the south-east with tasmania and maybe NZ postgame but i propose the north for the following reasons:
you have acces to 4 large bioms, the outback, the temperate coast, the sea and the (postgame?) jungles of new guinea. having that as the island of choice also makes the map more compact than with a massive ocean leading to NZ
Also the mollucs northwest to pic rel make the ideal place to put legendaries and a sevii islands equivalent in
