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I cycled around Sydney for a year or two without a helmet. I got pulled over a couple of times and only received friendly reminders so you should be fine, but as @WestcoastPete says, the laws are about to get a lot more punitive.
As for cycling in Sydney; it's not as good as London, but it's not as bad as, say, Paris. The car is king and there are roads that you just have to learn to avoid.
Also, traffic lights and laws work a bit differently, and you'll be taken by surprise when you appear to have a green light but pedestrians keep crossing the road that you're trying to turn into. They have right of way so try not to yell at them too much.
The other big difference is the weather. The humidity always seems to be above 70% so you'll struggle to get anywhere without sweating buckets.
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cyclotron3k
@chris_tim
Dredging a bit here but I'm heading out to Sydney for a month, will be taking my bike hopefully. Anyone got any pointers for riding over there? I've heard its fairly hilly, this doesn't bother me too much as it can't be worse than where I am currently. Will take my helmet with me but would like to know how hot the fuzz actually are on enforcing the law? I wear a helmet the majority of the time but I don't want to get busted by crusing to the local pub without one.