I mean, you don't really have to speculate about what this is for, it's for an authority providing for lawful search, it seems pretty well-scoped, and similar to any old search warrant, which is not a new thing, really https://classic.austlii.edu.au/au/legis/nsw/consol_act/deccd...

Basically, they're not really setting up for a blanket ban on personal security features, that interpretation is obviously catastrophizing. Not that there aren't hamfisted laws somewhere like this, but NSWs implementation seems OK I guess