By "ETA" are we here referring to something like an ESTA, which can be lied on, and that being the only barrier to entry to Australia?

I find it hard to imagine the Australians being that lax. 

One difficulty will be that the whole union will be as tight as its tightest member (or else the weaker-bordered nations will be regarded as routes into the tight-bordered ones, who will reject the union under such circumstances).

Although for those people who are prepared to be 'economical with the truth' when applying for an ETA, this could be a real game changer as the employment visas today require a police certificate and if you don't need an employment visa in the future ......

Probably not. I suspect that everyone would still need an ETA and this would just remove the need to have a separate employment visa.

Would this change much?
https://www.canzukinternational.com/2019/12/fta.html?fbclid=IwAR1gYMzV5Ppl8d-vjvcbDO8gckYKyDK1RLfzKVzzvGMMATYKeItKLAICVww