Hi,
Australian copyright arrangements can be found at:
http://www.copyright.org.au/g070.pdfBriefly, it's legal to make copies of stuff you own for your own use. This has only been the case since late 2006 (which is crazy, it should have always been the way it is now).
Some bits I still think are a bit stupid, and I think technically downloading a digital version of something you have on vinyl might still be considered naughty.
Agree with shanker on low quality versions, perhaps like lower quality streaming audio as can be found on MySpace or similar. The main impact of continual increased enforcement of copyright law on the Internet is that I hear less music and buy less music *shrugs*